The Governor of the Bank of Greece spoke about the role of microloans in fostering and promoting entrepreneurship during an event held by the Hellenic Development Bank for the launch of its new Microloan Fund.

As Mr. Stournaras stated, microloans are a tool that can turn challenges into opportunities. “They give hope and strength to those who need it most. Let’s work together to ensure that microfinance remains a driver of social and economic progress, offering not just capital, but also hope for a better future.”

According to Mr. Stournaras, the microfinance sector in Greece is still relatively new and in its early stages of development. So far, only three microfinance institutions have been licensed by the Bank of Greece and are currently operating in the country: TMEDE Microfinance Solutions, Microsmart, and AFI Microfinance.

It is evident that microfinance has yet to gain significant traction within the broader Greek financial system. This is precisely why the creation of the Microloan Fund by the Hellenic Development Bank is so important. The capital injected into the sector is expected to significantly increase the volume of microloans granted. However, for this to succeed, these institutions must strengthen their organizational structures and risk management strategies to absorb the incoming funds effectively. At the same time, this initiative serves as an opportunity to bring microloans back into the spotlight and make the concept more widely known to the people who can benefit from it the most.

As the Governor of the Bank of Greece explained, microfinance is not just about granting small-scale loans, as many might assume. Instead, it is a comprehensive financial empowerment tool that also includes guarantees, financial education, and advisory support. To achieve their objectives, microfinance institutions must provide adequate financial education to borrowers, ensuring they understand fundamental concepts such as capital management and financial planning. This, in turn, will enhance the sustainability of their investments and contribute to long-term economic stability.