The European Bank for Reconstruction and Development (EBRD) will provide multi-million loans to develop small and medium enterprises (SMEs) in the post-Communist countries of Mongolia and Armenia.

Mongolian microfinance institution Transcapital will benefit from a facility of ₮6bn (£1.8m). It will be provided in the local currency of Mongolian tugrik (MNT), in order to minimise exchange rate risk for business owners.

The ERBD has invested $1.6bn ($1.2bn) in Mongolia since 2006. This is the second such loan for Transcapital, who have been clients of ERBD’s since 2013.

Armenian businesswomen, meanwhile, will gain access to €8m (£6m) in lending, which will also come in local currency. It will be provided through Armenian bank Araratbank, in which the ERBDS is a shareholder for 18%.

The package forms part of the Women in Business programme, a joint partnership between the ERBD and the EU. It will include risk mitigation facilities in the form of first-loss cover.

Both loans are backed by the Early Transition Countries fund, a joint initiative by the EU, Sweden and the ERBD covering a number of Eurasian countries formerly in the Soviet space.