Credits Accessible To the Population in the Central Region and Their Comparative Analysis

In this report, the Aran Humanitarian Regional Development Organization finds that the following sources of capital were necessary to build capacity in start-up organizations and spur entrepreneurial activity within central Azerbaijan regions:

• Privilege state credits such as the National Fund of Assistance to Entrepreneurs, which help support social and economic programs within the private sector framework, and development of various industries and infrastructures;
• Non-bank credit institutions, which provide credits to development organizations, similar to what traditional banks do; however these non-bank credit institutions work in closer collaboration with their debtors than traditional banks do;
• Credit unions, which are a scheme for mutual crediting whereby different entrepreneurs within the community merge to create profit. Characteristics include voluntary membership, publicity of the activity, and self-control basis of organization of the activity;
• Commercial credits at market rates from private or public bodies, such as the Agrarian Industrial Bank can assist entrepreneurs in creating sustainable and profitable operations;
• Non-official credits that are one of the most popular financial resources and are provided in person with high interest rates attached. These credits are frequently used for emergencies or unexpected circumstances, and are rarely used for business purposes.

The report finds that out of these five credit sources, the population:

• Has found it difficult to access funds from the National Fund of Assistance to Entrepreneurs, although these credits are often the most practical;
• High interest rates have also made it difficult for entrepreneurs to access credit from non-bank credit institutions.

The report concludes that there exists:

• An insufficient number of authorized banks to issue credit;
• Excess bureaucracy.