Working Capital for Rural Development

1. Borrowers

Eligible borrowers are farmers and entities doing business in the agricultural products processing industry as well as entities doing business in the forestry industry set up in the following legal forms:

- family farms,
- crafts businesses registered for performing activities in the agricultural industry,
- companies (processing entities included),
- co-operatives (processing entities included).

The borrowers are obliged to prove that they have difficulties in doing business as a consequence of the pandemic caused by COVID-19 virus in accordance with the criteria adopted by the Ministry of Agriculture.

2. Eligibility Criteria

Eligible are those borrowers whose operations take place under the following measures, sub-measures and types of operations under the Rural Development Programme of the Republic of Croatia for the 2014-2020 (RDP):

Measure 4: Investments in physical assets
Sub-measure 4.1: Support for investments in agricultural holdings	Type of operation 4.1.1: Restructuring, modernisation and increased competitiveness of agricultural holdings Type of operation 4.1.2: Disposal, handling and use of manure fertilizer in order to reduce the harmful effects on the environment Type of operation 4.1.3: Use of renewable energy sources
Sub-measure 4.2: Support for investments in processing/marketing and/or development of agricultural products	Type of operation 4.2.1: Increase in value added to agricultural products Type of operation 4.2.2: Using renewable energy sources
Measure 6: Farm and business development
Sub-measure 6.4: Support for investments in creation and development of non-agricultural activities in rural areas	Type of operation 6.4.1: Development of non-agricultural activities in rural areas
Measure 8: Investments in forest area development and the improvement of forest viability
Sub-measure 8.6: Support for investments in forestry technologies and in processing, mobilisation and marketing of forest products	Type of operation 8.6.1: Modernisation of technologies, machines, tools and equipment for wood harvesting and forestry cultivation Type of operation 8.6.2: Modernisation of technologies, machines, tools and equipment in pre-industrial wood processing

3. Purpose of Loans

• Financing of working capital needed for the elimination of instabilities in production and financing of current operations (preparation of production, raw materials, other operating costs, labour costs, settling of obligations towards suppliers and other current operating costs except for loan obligations towards commercial banks and other financial institutions as well as VAT)
• Refunding of existing loans is not eligible
• Refund of previously invested funds will be accepted by HBOR for the payments made as a rule not longer than 3 (three) months before the submission of loan application

4. Manner of Implementation

Direct lending

5. Loan amount, disbursement period and repayment

Loan amount	from EUR 25,000 to EUR 200,000
Disbursement period	up to 6 months
Repayment period	up to 5 years, up to 12-month grace period included

6. Interest Rate

0.5% per annum, fixed

7. Fees

No fees charged

8. Collateral

Debentures and blank debentures of borrowers and, depending on the assessment of risk, debentures and blank debentures of associated entities

9. Roles in Implementation

The Croatian Bank for Reconstruction and Development (Hrvatska banka za obnovu i razvitak), the Ministry of Agriculture and the Paying Agency for Agriculture, Fisheries and Rural Development entered into the Agreement on Financing for the Implementation of Financial Instrument “Working Capital for Rural Development”.