Albania to establish development bank to support SMEs and green investments

The Albanian government has announced plans to establish the Albanian Development Bank (ADB), an institution designed to support small and medium-sized enterprises (SMEs), startups, and major infrastructure projects. The initiative will prioritize green investments, aiming to promote sustainable development while enhancing the competitiveness of “Made in Albania” products in both local and international markets.

Why is this important: The ADB will bridge the financing gap faced by new businesses and startups, which often struggle to secure loans due to a lack of credit history and collateral. Commercial banks typically avoid high-risk lending, making it difficult for innovative ventures to access capital. By providing tailored financial solutions, the ADB will help stimulate entrepreneurship, job creation, and economic diversification, while also aligning Albania with global sustainability trends.

Context: Development banks have a proven track record in both regional and global economies. For instance, North Macedonia’s development bank has been essential in financing local enterprises, while Brazil’s Development Bank has supported startups and companies facing challenges with traditional lenders. These institutions play a vital role in national economic growth, emphasizing job creation and investment in priority sectors. The ADB aims to replicate this success in Albania, ensuring that critical projects receive the necessary funding.

One of the biggest obstacles for new businesses is their limited access to credit, as commercial banks often require strict financial guarantees. The ADB will fill this gap by offering loans and financial products tailored to startups and SMEs, fostering innovation and economic expansion. By doing so, the bank will diversify Albania’s economy and reduce its reliance on traditional industries.

What’s next: Determining the financial structure of the ADB will be critical for its sustainability. Learning from international models such as Italy’s BancoPosta and Brazil’s Development Bank can offer valuable insights. The Albanian government has pledged 10 billion lek in capital over four years, providing a strong starting foundation. However, alternative funding sources, including public deposits and other financial instruments, will be needed to expand the bank’s lending capacity and long-term viability.

If implemented successfully, the ADB has the potential to be a game-changer for Albania’s economy, offering crucial financial support for entrepreneurs, SMEs, and strategic infrastructure projects. By encouraging domestic production, increasing employment, and boosting international competitiveness, the Albanian Development Bank will play a key role in shaping the country’s economic future.