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Thematic Area:

SME Banking & Development


2019 – 2020


Kreditanstalt für Wiederaufbau (KfW)


Turkey, Caucasus & Central Asia

Country Coverage:           


Project Overview

Turkey hosts more refugees than any other country in the world. Large migration flows from Syria fleeing from the civil war in their home country has affected the country. After the initial stage of humanitarian aid that provided the necessary livelihoods to 3.64 million Syrian refugees, consensus among stakeholders indicated Syrian refugees should enter into the formal labour market with better skill competences in a balanced way – Syrian refugees and the Turkish host communities.

The main objective of the Project is to conduct a feasibility study outlining the options available to Turkish partner institutions to financially support Small and Medium-sized Enterprises (SMEs) in selected regions and sectors to create employment for Syrian Refugees under Temporary Protection (SuTP). A guarantee mechanism is foreseen that would lead to lower interest rates and collateral requirements for SME loans as well as investments in target provinces (mainly in southern Turkey).


Frankfurt School experts have started to work on the two-part feasibility study that includes a market assessment and an institutional assessment:

  1. Market Assessment: assessing the labour demand of SMEs heavily populated SuTP regions (with formal job creation as the main objective of possible interventions):
  • SME sector assessment in target regions, sector overview and employment figures in provinces with relatively high potential to absorb the SuTP labour force; and,
  • Labour market assessment of supply and demand in the target provinces/sectors and the existing financial schemes available to SMEs in the target provinces.

2. Institutional Assessment: setting up a guarantee scheme for SMEs that incentivises the employment of SuTP and Turkish citizens:

  • Assessment of the financial supply to SME markets, including the assessment of stakeholders and existing guarantee instruments/products that support the SME sector;
  • Assessment to operationalise a guarantee instrument that supports SMEs operating in selected sectors in the target provinces and the creation of formal employment; and,
  • Design of a programme-specific guarantee mechanism and incentive scheme.