OCDE - Financing SMEs and Entrepreneurs 2026 - Georgia de 2026

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FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

Key facts on SME financing As of October 2025, 99.7% of active enterprises in Georgia were SMEs. In 2024, SME s accounted for 60.6% of business sector employment, 32.3% of business sector turnover and 53.2% of output in the business sector, and the share of the value added created by SMEs in the busi ness sector amounted to 52.3%. In recent years, credit to SMEs rose significantly. In 2024, SME loans increased by 12.6%1 compared with

2023. In nominal terms, outstanding SME loans amounted to 23.9 billion GEL. Total busi ness loans grew by more than 16.8%, and the proportion of SME loans as a percentage of total bu siness loans amounted to 66%.

The average interest rate charged to SMEs in Georgia is high by OECD standards, but it has s ignificantly declined over the last decade, from 17.5% in 2010 to 10.8% in 2024. In 2024, the inter est rate spread between SMEs and large firms amounted to 0.3 percentage points. The Georgian government supports SMEs through loan guarantees. The state program – Credit Guarantee Scheme was developed to improve access to finance for SMEs that are unable to meet existing col lateral requirements for loans. Under the program, a credit guarantee is issued for each loan provi ded by a commercial bank, covering up to 80% of the loan principal. Additionally, for each commercial bank, the guarantee can cover no more than 35% of the program's total loan portfolio. In addition, in September 2024, a new Micro Entrepreneurship Support Program was launched, which provides guarantees of up to 80% to MSMEs on small loans, of up to GEL 50,000. As a result of the two programs, in 2025, guaranteed

2024, a new Micro Entrepreneurship Support Program was launched, which provides guarantees of up to 80% to MSMEs on small loans, of up to GEL 50,000. As a result of the two programs, in 2025, guaranteed loan volumes increased from GEL 2 65 million to GEL 291 million, and total guarantees from GEL 1 88 million to GEL 215 million. This reflects strengthened state efforts to improve SME access to f inance. Total non-performing loans in 2024 amounted to 2.5%, while the share of non-performing loans in SMEs equalled 5.2%. The government of Georgia has prioritised SME development as the main driver of privatesector growth, job creation, and innovation. For instance, the Innovation and Entrepreneurship Pol icy is one of the successful reforms the Georgian Government has conducted. Through budgetary support, in 20 14, the Ministry of Economy and Sustainable Development of Georgia established two sister agencies, Georgia’s Innovation and Technology Agency (GITA) and Enterprise Georgia, with the main ob jective of promoting SME development and strengthening SME competitiveness. Both agencies provide financial support to SMEs, as well as a broader range of services, including access to specialised infrastructure, mentoring, training, and various advisory services. In addition to establishing these two agenci es, the Government of Georgia has introduced several private-sector development programmes that include financi al and technical assistance components to support SMEs at different stages of development. In May 2026, LEPL Enterprise Georgia was transformed into JSC Georgian Economic Development Corporation (GEDC), consolidating existing and new state-supported instruments for private sector development under a single institution. As the legal successor of LEPL Enterpri se Georgia, GEDC will continue implementing its core business support programs, including the interes t rate subsidy and credit guarantee schemes, micro-entrepreneurship support, capital market development, export promotion, and business consulting services. In addition, the Corporation will also support d iversification of alternative financial instruments. Georgia2 

continue implementing its core business support programs, including the interes t rate subsidy and credit guarantee schemes, micro-entrepreneurship support, capital market development, export promotion, and business consulting services. In addition, the Corporation will also support d iversification of alternative financial instruments. Georgia2 

FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

Table 1. Scoreboard for Georgia Indicator Unit 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Debt Outstanding business loans, SMEs GEL million 1 400 1 548 1 738 2 051 2 422 3 612 4 451 5 266 6 006 7 062 7 788 8 516 18 193 21 024 23 941 Outstanding business loans, total GEL million 2 984 3 458 3 097 4 145 4 821 5 344 6 080 7 268 9 243 10 693 12 269 14 687 19 037 23 224 25 828 25 791 30 726 36 280 Share of SME outstanding loans % of total outstanding business loans 33.77 32.10 32.52 33.74 33.32 39.07 41.63 42.93 40.89 37.10 33.54 32.97 70.54 68.42 65.99 Short-term loans, SMEs GEL million

330 552 553 515 444 648 781 1 923 1 576 2 098 Long-term loans, SMEs GEL million

3 282 3 899 4 714 5 491 6 619 7 141 7 734 16 270 19 448 21 843

Long-term loans, SMEs GEL million

3 282 3 899 4 714 5 491 6 619 7 141 7 734 16 270 19 448 21 843 Share of short-term SME lending % of total SME lending

9.14 12.40 10.49 8.58 6.28 8.32 9.18 10.57 7.50 8.76 Government loan guarantees, SMEs GEL million

112 132 164 151 185 Government guaranteed loans, SMEs GEL million

135 165 248 210 259 Non-performing loans, total % of all business loans

16.10 11.00 12.00 10.70 10.60 9.80 10.10 7.70 6.60 4.90 8.40 5.20 4.10 2.60 1.86 Non-performing loans, SMEs % of all SME loans

10.30 8.70 6.40 5.00 4.20 4.40 5.20 4.30 6.10 4.90 9.80 6.51 5.32 4.50 5.19 Interest rate, SMEs %

17.48 15.63 15.05 12.91 11.60 12.63 12.32 12.52 12.27 11.18 10.63 10.85 11.06 11.10 10.84 Interest rate, large firms %

14.90 14.62 12.79 11.40 10.23 10.26 9.71 9.25 9.26 8.62 8.53 9.21 11.49 11.18 10.58 Interest rate spread Percentage points

14.90 14.62 12.79 11.40 10.23 10.26 9.71 9.25 9.26 8.62 8.53 9.21 11.49 11.18 10.58 Interest rate spread Percentage points

2.58 1.01 2.27 1.51 1.37 2.37 2.61 3.27 3.01 2.56 2.10 1.63 -0.44 -0.08 0.26 Collateral, SMEs % of SMEs needing collateral to obtain bank lending

96

Rejection rate 1-(SME loans authorised/ requested)

16.13 29.18 17.31 13.20 12.11 15.54 19.84 18.67 18.18 14.38 17.60 12.06 10.10 Other indicators Bankruptcies, SMEs Number

2 094 3 176 2 524 1 775 1 785 1 560 229 293 153 208 147 Bankruptcies, SMEs (growth rate) %, Year-on-year growth rate

51.67 -20.53 -29.68 0.56 -12.6 -85.32 27.95 -47.78 35.95 -29.33

Source: See Table 2. 3

FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

Macroeconomic and financing conditions Prior to the COVID-19 pandemic, the Georgian economy was characterized by robus t growth, averaging 5.0% annually between 2016 and 2019. The pandemic significantly disrupted this trajectory, with the economy contracting by 6.3% in 2020. However, the Government of Georgia responded s wiftly and effectively, implementing substantial support measures for vulnerable households and businesses. These

5.0% annually between 2016 and 2019. The pandemic significantly disrupted this trajectory, with the economy contracting by 6.3% in 2020. However, the Government of Georgia responded s wiftly and effectively, implementing substantial support measures for vulnerable households and businesses. These policy actions helped preserve macroeconomic stability and laid the founda tion for a rapid and resilient recovery. Since 2021, Georgia's economy has demonstrated remarkable momentum. In 2021 an d 2022, real GDP growth reached double-digit rates,10.6% and 11% respectively, bringing economic output well above prepandemic levels. Despite continued geopolitical tensions, growth remained strong in 2023, reaching 7.8%, and accelerated further in 2024, with preliminary estimates placing growth at 9.7%. Econom ic growth in 2025 amounted to 7.5%. On average, Georgia’s post-pandemic growth performance (2021–2025) stands out globally, averaging 9.3%. Growth has been broad-based across sectors, primarily driven by trade, construction, information and communication, transportation and storage, and other services. Particularly, the IT and communication sector has shown robust performance since 2021, supporting productivity gains and boos ting potential output. On the expenditure side, gross capital formation made the largest contribution to GD P growth in 2023, increasing by 19.5% yearon-year, while real consumption surged by 11% in 2024, supported by elevated real wages and strong credit growth. Service exports, including tourism and IT services, also played a key role. Inflation has remained among the lowest in the broader region. Average inflation in 2023 and 2024 stood at 2.5% and 1.1%, respectively. The combination of low inflation and strong growth r eflects productivity gains and an increase in potential GDP. Nevertheless, the surge in consumption since 2024 calls for close monitoring of demand-side inflationary pressures. In light of these dynamics, the National Bank of Georgia

at 2.5% and 1.1%, respectively. The combination of low inflation and strong growth r eflects productivity gains and an increase in potential GDP. Nevertheless, the surge in consumption since 2024 calls for close monitoring of demand-side inflationary pressures. In light of these dynamics, the National Bank of Georgia has cautiously eased monetary policy, reducing the policy rate from 11% in March 2023 to 8.0% by May 2024. Thanks to prudent fiscal policy and sound macroeconomic management, the fiscal deficit and government debt continued to decline. In 2024, the fiscal deficit was reduced to approximately 2.3% of GDP, down from about 9.4% of GDP in 2020, to roughly 6.0% in 2021, around 3.0% in 2022, and approximately 2.4% in 2023. Government debt under the fiscal rule definition declined to 35.7%. Acc ording to the Ministry of Finance, debt is expected to stabilize at an average of 35% of GDP between 2025 and 2 028, well below the 60% ceiling stipulated by fiscal rules. Labor market indicators have also improved. In 2024, the unemployment rate fell by 2.5 percentage points to 13.9%, accompanied by an increase in labour force participation and overall employment. SMEs in the national economy As of October 2025, 99.7% of active enterprises in Georgia were SMEs. In 2024 SMEs accounted for 60.6% of business sector employment, 32.3% of business sector turnover and 53.2% of output in the business sector. The share of the value added created by SMEs in the business sector amounted to 52.3% in 2024.4 

FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

SME lending In recent years, credit to SMEs rose significantly. In 2024 SME loans increased by 12.6%21 compare with

in 2024.4 

FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

SME lending In recent years, credit to SMEs rose significantly. In 2024 SME loans increased by 12.6%21 compare with

2023. In nominal terms outstanding SME loans amounted to 23.9 billion GEL. Total busines s loans grew by more than 16.8%, and the proportion of SME loans as a percentage of total business amounted to 66%.

The average interest rate charged to SMEs in Georgia is high by OECD standards, but it has s ignificantly declined over the last decade, from 17.5% in 2010 to 10.8% in 2024. In 2024 interest rate spread between SMEs and large firms amounted to 0.3 percentage points. Credit conditions According to the 2023 World Bank Enterprise Survey, enterprises in Georgia primar ily rely on internal resources to cover investment costs, representing 68.6% of total investment expenses, a tr end that has remained relatively stable since 2013. According to the same survey, 51.2% of small enterprises and 53.3% of medium enterprises have bank loans, with a higher rate of 73.9% observed in large ent erprises. Notably, collateral requirements remain elevated, averaging 200.9% of the loa n amount for small enterprises and 229.9% for medium enterprises, reaching an overall average of 203.5% for all e nterprise types. Access to finance emerged as the third major obstacle for enterprises, as indicated by the surveys. Specifically, 16.7% of small and 17.7% of medium enterprises identified access to finance as their primary obstacle, while only 8.8% of large firms identified it as such. Other indicators Government supports for SMEs through loan guarantees. State Program – Credit Guarantee Scheme was developed to improve access to finance for small and medium-sized enterprises (SME s) that are unable

obstacle, while only 8.8% of large firms identified it as such. Other indicators Government supports for SMEs through loan guarantees. State Program – Credit Guarantee Scheme was developed to improve access to finance for small and medium-sized enterprises (SME s) that are unable to meet existing collateral requirements for loans. Under the program, a credit guarantee is issued for each loan provided by a commercial bank, covering up to 80% of the loan principal. Addi tionally, for each commercial bank, the guarantee can cover no more than 35% of the total loan portfolio under the program. In addition, in September 2024, a new Micro Entrepreneurship Support Program was launched , which provides guarantees of up to 80% to MSMEs on small loans, of up to GEL 50,000. As a result of the two programs, in 2025, guaranteed loan volumes increased from GEL 265 million to GEL 291 million, and total guarantees from GEL 1 88 million to GEL 215 million. This reflects strengthened state efforts to improve SME access to finance. Notably, some of the loans approved under the Micro Entrepreneurship Support Program are also eligible to receive full interest rate subsidies for five years. In addition to administering the Credit Guarantee Scheme, the Georgian Economic Development Corporation (GEDC) , supports SME access to finance through the Business Universal Program. The program co-finances interest payments on commercial bank loans and leasing projects, and can be used together with the Credit Guarantee Scheme . Under the program , loans or leases valued between GEL 50,000 and GEL 10 million are eligible for interest subsidies throughout the full term, while additional grant (cashback) mechanisms have been introduced to incentivise green investments, digita lisation, research and development, business activity in mountainous regions, agrotourism, and women entrepreneurs. Since 2014 to the end of 2025, 3,355 projects have been approved, supporting more than GEL 3.2 bi llion in loans. In 2025 alone, 499 projects were approved, corresponding to approximately GEL 430 million in

2014 to the end of 2025, 3,355 projects have been approved, supporting more than GEL 3.2 bi llion in loans. In 2025 alone, 499 projects were approved, corresponding to approximately GEL 430 million in loans. Total non-performing loans in 2024 amounted to 2.5%, while the share of non-performing loans in SMEs equalled 5.2%. 5

FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

Government policy response The government of Georgia has prioritised SME development as the main source of private sector growth, job creation and innovation. For instance, the Innovation and Entrepreneurship Policy i s one of the successful reforms the Georgian Government has conducted. Through budgetary support, in 20 14, the Ministry of Economy and Sustainable Development of Georgia established two sister agencies, Georgia’s Innovation and Technology Agency (GITA) and Enterprise Georgia, with the main ob jective of promoting SME development and strengthening SME competitiveness. Both agencies provide financial support to SMEs, as well as a broader range of services that includes access to special infrastructure, mentoring, training and various advisory services. In addition to establi shing of these two agencies, the Government of Georgia has introduced several private sector development programmes that include fina ncial and technical assistance components to support SMEs at different stages of development. In May 2026, LEPL Enterprise Georgia was transformed into JSC Georgian Economic Development Corporation (GEDC), consolidating existing and new state-supported instruments for private sector development under a single institution. As the legal successor of LEPL Enterpri se Georgia, GEDC will continue implementing its core business support programs, including the interes t rate subsidy and credit guarantee schemes, micro-entrepreneurship support, capital market development, export promotion, and business consulting services. In addition, the Corporation will also support d iversification of alternative financial instruments. Building on its solid track record as a top reformer, Georgia has made considerable progress since the

guarantee schemes, micro-entrepreneurship support, capital market development, export promotion, and business consulting services. In addition, the Corporation will also support d iversification of alternative financial instruments. Building on its solid track record as a top reformer, Georgia has made considerable progress since the 2012 SME Policy Index assessment and has adopted a more proactive approach to SME development through targeted initiatives. The government of Georgia has been implementing its National SME Development Strategy 2021-2025, which was adopted following the successful impl ementation of the country’s first SME Strategy 2016 -2020 and its action plan, envisaging the results and achievements of the previous strategy and reflecting remaining challenging issues. The strategy reiterates its focus, among other priorities, on further enhancement of SME access to finance. The strategy intends to achieve the set goal of enhancing access to finance through the development of state financing programs, the development of alternative mechanisms of financing, further improvement of financial literac y, expansion collateral base, increasing the transparency and quality of SMEs’ financial Information and through further development of Venture Capital (VC)” and business angels ecosystem. The consecutive progress of Georgia’s SME policy and its implementation has been shown in the 4 rounds of OECD assessment “SME Policy Index”. Georgia gained the highest scores in 11 out of 12 di mensions, including access to finance, among the EaP countries and took a leading posi tion throughout the region according to the last OECD assessment “SME Policy Index 2024”. Legal and institutional framework for SMEs In 2015, the government of Georgia developed the National SME Development Strategy 20 16-20 with support from the OECD. The strategy was adopted in 2016. The Ministry of Economy an d Sustainable Development of Georgia was the main coordinator of the strategy’s implementation. In 2020 G eorgia, developed new National SME Development strategy 2021-2025. According to the study by the Organization for Economic Cooperation and Develop ment (OECD) „SME Policy Index - 2024“ Georgia achieved unprecedented success - in 2024, Georgia’s score (compared to

developed new National SME Development strategy 2021-2025. According to the study by the Organization for Economic Cooperation and Develop ment (OECD) „SME Policy Index - 2024“ Georgia achieved unprecedented success - in 2024, Georgia’s score (compared to 2020) improved in 10 directions; Georgia was evaluated with the highest score in 11 out of 12 components among Eastern Partnership countries. The new insolvency framework fully enacted in 2021, has successfully resulted in a significant increase in cases of rehabilitation and reduction in duration and business costs associated with insolvency proceedings, thus supports the releasing frozen assets back into the economy.6 

FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

Timely and targeted SME support programs have proven an effective tool to address spec ific market failures, support risk diversification and credit supply growth. Promotion of alternative sources of finance One of the objectives of the SME Development Strategy 2025 is the development of l ocal capital markets and creation of alternative sources of financing. Development of sources with higher risk is very important, as the readiness of commercial banks for financing such projects is relatively low. Accordingly, on the one hand it is important to develop alternative financing instruments, including through refining the legislative framework, and on the other hand to raise the awareness of entrepreneurs regarding the advantages of the alternative financing instruments. The development of alternative financing mechanisms represents one of the mo st important dimensions for promoting access to finance, where Georgia, despite the substantial progress, has room for significant improvement. Within the framework of “Development of Alternative Financing Mechani sms for MSMEs”, the Government of Georgia has included the development of Factoring regulatory fr amework, in line with best international practices, as an important tool to support private sector competitiveness. Notably, development of alternative finance mechanisms will be one of the key p riorities of the Georgian Economic Development Corporation (GEDC), the legal successor of Enterprise Georgia. The Corporation already operates a Capital Market Support Programme, under which, 12 companies iss ued corporate

Notably, development of alternative finance mechanisms will be one of the key p riorities of the Georgian Economic Development Corporation (GEDC), the legal successor of Enterprise Georgia. The Corporation already operates a Capital Market Support Programme, under which, 12 companies iss ued corporate bonds totaling GEL 904.4 million during 2024 –2025, including five first-time issuers. Of this amount, GEL 667.8 million was raised by eight companies in 2025 alone. Building on these efforts, GEDC plans to further diversify financing options available to SMEs through the introduction of a fac toring platform to improve access to short-term working capital, support for investment funds, new instrumen ts aimed at facilitating corporate bond issuance, and a direct equity participation mechanism. These initiativ es are intended to strengthen access to non-bank financing and contribute to the development of Georgia’s broader financial ecosystem. Figure 1. Trends in SME and entrepreneurship finance in Georgia

Source: See Table 2

0 5 000 10 000 15 000 20 000 25 000 30 000 35 000 40 000

A. SME and total business loans Annual, in GEL million Outstanding business loans, SMEs Outstanding business loans, total

-2 0 2 4 6 8 10 12 14 16 18 20 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Interest rate, SMEs Interest rate, large firms Interest rate spread

B. Interest rate and interest rate spread Annual, as a percentage 7

FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

Table 2. Sources and definitions of Georgia’s Scoreboard Indicators Definition Source Business loans, SMEs Bank loans to SMEs, amount outstanding (stocks) at the end of period. National Bank of Georgia

Table 2. Sources and definitions of Georgia’s Scoreboard Indicators Definition Source Business loans, SMEs Bank loans to SMEs, amount outstanding (stocks) at the end of period. National Bank of Georgia Business loans, total Bank loans to all non-financial enterprises, including SMEs loans, amount outstanding (stocks) at the end of period. National Bank of Georgia Non-performing loans, total Substandard loans together with doubtful and loss loans, including interbank loans. National Bank of Georgia Non-performing loans, SMEs Substandard loans together with doubtful and loss loans, including interbank loans. National Bank of Georgia Interest rate, SMEs Annual Weighted Average Interest Rates on loans (stocks) to SMEs National Bank of Georgia Interest rate, large firms Annual Weighted Average Interest Rates on loans (stocks) to all non-financial enterprises National Bank of Georgia Collateral, SMEs Percentage of SMEs that were required to provide collateral on latest bank loan National Bank of Georgia Rejection rate Percent of firms whose recent loan application was rejected National Bank of Georgia Bankruptcies, total The number of bankruptcy proceedings that are actually initiated and registered in the Public Registry Agency of Georgia during the reference period. Public Registry Agency

Notes

1 Growth rate figures are inflation adjusted. 21 Growth rate figures are inflation adjusted.

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Please cite this publication as: OECD (2026), Financing SMEs and Entrepreneurs 2026: An OECD Scoreboard, OECD

Publishing, Paris, https://doi.org/10.1787/075d8058-en.

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FINANCING SMES AND ENTREPRENEURS 2026: GEORGIA © OECD 2026

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