On 19 October, 2022 an online training on access to cleantech finance support for MSMEs was conducted for Uzbek REAP Technical Consultants (TCs). The training was given by Senior Project Manager of adelphi, Germany – Mr. Amarnath Munnolimath. The main objective of the training was to provide the technical consultants with knowledge of the project activity on access to cleantech finance for MSMEs and to integrate them into the implementation of the activity.
As an opening session an interactive exercise was conducted at the workshop to identify challenges in accessing finance for high investment costs for MSMEs (Figure 1) highlighted by the REAP TC’s. The challenges highlighted the most were high interest rates on loans, followed by MSMEs' caution in pursuing external investments owing to the risks involved, such as payback, and possibly fear of losing control, and MSMEs' lack of financial resources to implement SCP and other improvements. Access to Finance is one of the main limiting factors of transformational change of production and other economical sectors to greener path.
Facilitating access to cleantech finance for MSMEs is envisaged in the project as one of the key activities to ensure the success of MSME transformation, as well as to demonstrate the feasibility of change in other agro-food MSMEs. Technical consultants and experts will act as intermediaries and provide information on opportunities to access to cleantech financing in the local context.
Provision of knowledge for ensuring understanding of TC’s and bringing all of them on the same page on the cleantech finance as a concept is a crucial step as not all TC’s had an experience in supporting MSMEs in access to finance. Therefore, the Workshop has started with the concept of clean technology finance and the different terminology that can be used to denote it was explained. This will help TC’s and MSMEs to navigate among the multitude of terms used to refer to different financial products and identify schemes proper for SCP implementation. Subsequently, aspects that are important to consider when applying for investment from the perspective of both the investor and the applicant (MSME) were covered.
This was followed by a step-by-step approach for TC’s to identifying suitable financing options, indicating which cases could be financed from external funding sources, a decision tree for external/internal financing, types of financing as loans, credits and grants. The pros and cons of each type of financing and a checklist for applying for a loan were explained as well. Examples of bankable high-cost SCP investment technologies and their approximate costs were provided to facilitate the understanding of consultants in selecting and providing recommendations to MSMEs on the possible bankable investments to SCP technologies.
Last but not least, an overview of project support was presented to determine the scope of the intervention that would guide the TCs.
Although half of the TCs attending the workshop already had experience in supporting MSMEs in accessing finance, the feedback session highlighted the workshop as a very useful activity by providing a clear understanding of cleantech finance and a clear step-by-step guide to support MSMEs in accessing finance within the project.
The workshop was positively evaluated, and feedback from participants clearly demonstrates the high value of this type of capacity-building interventions for local consultants and MSMEs.