Programme for Development of Entrepreneurship in Art and Culture

 1. Programme Objective 

The objective of the programme is to ensure support for the development of entrepreneurship in the field of art and culture. If there are entrepreneurial-minded individuals in art and culture, it is necessary to provide them with favourable loans so they could turn their knowledge and experience into business, thus ensuring their and other people's existence. Special attention needs to be paid to the development of artistic crafts, such as, for example: advertising, design, photography, artistic interventions, audio and visual production, as well as in other fields of art and culture.

2.      Loan Purpose 

Loans are intended for investments in fixed assets - tangible assets (buildings, equipment and appliances, inventory...), intangible assets (service development, patents, licenses, copyrights, franchises...) and working capital. 

IDF may finance up to 75,00 % of the total investment value. 

The applicants for the loan can provide their own share in the amount of 25,00% of the total investment value within one year since the day of signing the loan agreement. 

Loan amount dedicated to investing in working capital may be up to 30,00% of the total loan amount. 

If a loan is financed from the European Investment Bank, funds can not be used for VAT financing. 

Financial support shall not be approved for the following purposes:

·         Parts of investments intended for meeting personal needs;

·         Catering facilities exclusively serving drinks;

·         Newspaper and other occasional edition publishing activities, activity of producing and airing radio and television programs, activities of newspaper agencies and services of marketing and public relations agencies;

·         Acquisition of shares in other companies, stocks and other securities;

·         Construction of residential and business units for sale;

·         Completed investments intended for loan obligations refinancing;

·         Participation in projects violating internationally recognized employee rights, including safety at work, rules and procedures in Montenegro;

·         Any of the activities perceived as illicit or environmental and/or human health threat: gambling, tobacco, alcoholic beverages (except wine and fruit brandies);

·         Immoral and illegal activities. 

NOTE: For financing projects based on new products or services that may be treated as innovation, beneficiary must provide special, detailed business plan.  For this type of products or services a corresponding certificate on registration of the product or service in subject with the competent body needs to be provided. 

3.      Loan Beneficiaries 

Loan beneficiaries may be business entities and entrepreneurs. 

End beneficiaries of these loan arrangements may be entities that have obtained a confirmation from the Tax Administration on their tax arrears). 

If the applicant is an business entity, the business entity itself and founders of business entity may not hold more than 20,00% of the share in another business entity, while in the case of entrepreneurs, the same must not hold share in another business entity of more than 20,00%.

Loan beneficiaries may not be companies with the share of legal entities in the ownership structure of more than 20,00%.

Loan application can be considered before the applicant registers its business entity, so that the decision on the loan is conditional, i.e, determine the time limit within which the applicant must register a business entity.

Right to a loan is not a guaranteed right and IDF MN JSC shall enact a decision on each Loan Application.

4.      Lending Method 

IDF MN JSC implements this Programme through direct lending to the loan beneficiaries. 

For all projects implemented through and with the guarantee of commercial banks requirements defined under separate credit lines apply. 

Loan Applications that are not supported with mandatory defined documents shall not be taken into consideration.

5.      Loan Conditions 

Loans approved under this credit line and financed by the European Investment Bank (EIB), will be approved at an interest rate from 0.50% to 0.70%[1] lower compared to the interest defined hereinafter.

Lending conditions:

  • Maximum amount up to € 100.000,00 for entrepreneurs up to € 30.000,00);

•    Interest rate of 3,00% annually with the proportional interest calculation method;

•    Maximum term of 12 years (including grace period);

•    Grace period up to 4 years. 

Special lending conditions:

For subjects implementing projects in northern municipalities of Montenegro and in municipalities that are below the average value of the development index in Montenegro, the interest rate amounts to 2,50% on an annual level with proportional interest calculation method. 


With the submitted guarantee of another business entity the amount over the set limits may be authorized in accordance with the guarantor's creditworthiness (except for trade sector), but not more than the maximum defined credit for the concerned activity (defined by the special credit line) and the following conditions:

·         Interest rate of 4,50% annually with the proportional interest calculation method;

·         Maximum term of 12 years (including grace period);

·         Grace period up to 4 years. 

INCENTIVE MEASURES: For entities implementing projects in Northern region municipalities or in municipalities that are below the average value of the development index in Montenegro

or entities that recruit 5 or more new employees under the project realization a special incentive measure of reduction of the interest rate by 0,50% shall be approved. Additionally, incentives shall pertain to loans approved with a commercial bank’s guarantee, in a way that the initial interest rate will be decreased by 1,0 %. Aforementioned incentives may only be used on one ground at the time. 

In case of a direct loan arrangement that is fully or partially supported by a bank guarantee, cash collateral or State (municipality) guarantee, such loan arrangement or its proportional part shall not be considered as exposure of the end beneficiary.

6.      Fees 

Fee amount:

  • 0,30% on the approved amount for subjects implementing projects in northern municipalities of Montenegro and in municipalities that are below the average value of the development index in Montenegro;
  • 0,60% on the amount approved for projects implemented in other municipalities.

7.      Utilization of Loan 

Loan utilization period is up to 24 months.

Final utilization period shall be established on the case-by-case basis for each individual loan arrangement dependent on the real needs and the dynamics of investing.

Loan beneficiaries shall be obliged to a dedicated usage of loan funds in accordance with this programme and agreement signed between IDF MN JSC and loan beneficiary. 

IDF MN JSC shall perform control of the dedicated usage of loan funds.

IDF MN JSC shall execute approved direct loans whose purpose is investing in fixed assets (and inventory), by transferring funds to:

  • The supplier’s account or service/works provider or
  • Loan beneficiary account in tranches - in phases. 

Transfer of funds directly to the Loan Beneficiary’s account in tranches – in phases, means that, as a general rule, the subsequent transfer of funds will not take place until the Beneficiary justifies dedicated usage of prior realized funds under the approved loan (fund per already transferred tranches).

Exceptionally, in case of refunds of the paid investments, the transfer of funds to the loan beneficiary's account may be performed as a single payment, in accordance with the present rulebook of IDF MN JSC.

8.      Means of Security 

As means of security, IDF MN JSC shall accept bills of exchange, mortgages over immovable property (the estimated value of the immovable property must be at least equal to the amount of the request loan), bank guarantees, local self-governments’ guarantees, guarantees of the Government of Montenegro, guarantees of prudential legal entities, stocks of receivables and other generally accepted instruments of security in the banking sector, in accordance with the Acts of IDF MN JSC and decisions passed by competent bodies of IDF MN JSC. 

All costs with regard to providing instruments of security as well as of the execution of insurance-related tasks, deletion and retrieval of realized instruments shall be carried by the loan beneficiary.

9.      Required Documents 

Documents required for Applicants with a registered activity:

  • Loan Application;
  • Investment programme in accordance with the methodology of IDF MN JSC, or an investment programme of an acceptable content;

·         Excerpt from the Central Registry of Business Entities - not older than 30 days;

  • Certificate on VAT registration, if the end user is subject to the VAT;
  • Valid statute of the Company;

·         Approval for access to Central Bank Regulatory Credit Registry data (CBRCR), including founders and related parties;

  • Valid form of the form of the certified signatures of the persons authorized to represent (OP) and the valid card of the deposited signatures;

·         Tax Administration certificate on settled taxes and contributions – not older than 30 days;

·         Official form for reporting on settlement of monthly taxes and social contributions for employees, verified by the Tax Directorate as evidence of the number of employees;

  • Proposal of the collateral;
  • Pro-forma invoices (photocopy or original) on procurement of equipment and inventory, preliminary invoices for construction works, preliminary agreements/agreements on purchase of real estate (IDF MN AS shall not accept offers/preliminary agreements issued by natural persons, exception being purchase of real estate, offers/preliminary agreements issued by related parties or internal invoices). The documents in subject may not be dated more than three months from the date of the submission of the Loan Application. 

For construction/expansion/reconstruction of business facility:

·         Real estate folio for the real estate where the concerned investments is realized not older than 30 days;

·         Building permit or (equivalent in accordance with The Law);

·         Priced bill of quantities and offers for execution of works.

For purchase of business premises:

·         Real estate folio in which the real estate which is the subject of the sale is registered which is not older than 30 days;

·         Preliminary agreement/agreement on purchase of real estate (certified by a competent notary); 

As a rule, all documentation is submitted in Montenegrin language. 

Required documentation for applicants who do not have a registered activity.

For the approval of a preliminary decision:

·         Loan application;

·         Investment program in accordance with the methodology of IDF MN JSC.;

·         Certificate of successful completion of training at the Directorate for Investments, development of small and medium enterprises and management of EU funds and / or with the Employment Agency of Montenegro;

·         Confirmation of the Employment Agency of Montenegro that the applicant is on the register of unemployed persons of the institution;

·         Approval for access to the data of the Regulatory Credit Registry of the Central Bank of Montenegro (RKR);

·         Copy of ID card of the applicant;

·         Proposal of security instruments;

·         Profit (copy or original) for the purchase of equipment and small inventory, calculations for the execution of construction works, pre-conditions for the purchase of real estate (IDF MNE JSC will not accept bids / pre-contracts issued by natural persons, except for the sale of real estate, offers / as well as internal invoices). The subject documentation cannot be older than 3 months from the date of submission of the loan application;

·         Statement on the home community; 

For the approval of the final decision:

·         Decision on registration of the end beneficiary in the Central registry of Business Entities or in another register of the competent authority or Excerpt from the Central Registry of Business Entities - not older than 30 days;

·         A VAT registration decision if the end user is a VAT payer;

·         Valid companies Statute;

·         Approval for access to the Central Bank of Montenegro Regulatory Credit Registry (CRR) data;

·         Valid form of certified signatures of persons authorized to represent (OP) and valid  card of deposited signatures;

·         Statement on affiliated persons[2]  of newly established legal entity;

·         Pro forma invoice attributable to a newly established legal entity. 

All documents, as a general rule, shall be submitted in Montenegrin language.

Executive office of the IDF MN JSC retains the right to request additional documents.

10.  Other Provisions 

Additional rules applicable to this Loan Programme, which are not mentioned in this document, are defined in special acts passed by competent bodies of IDF MN JSC.

11.  Credit Line Validity 

This Credit Line shall be valid until 31 December 2019, until it’s altered or terminated. 

President of the Board of Directors of IDF MN JSC 

                PhD Zoran Vukčević



[1] In addition to regular stimulation in the interest rate of 0.5% on funds withdrawn from the EIB, it is additionally possible to achieve stimulation at an interest rate of 0.2% if the requirements of the EYET initiative relating to the employment of young persons to the utilization of funds foreseen in the contract with the EIB.

[2] Article 3, point 8 of the Law on Banks - ("Official Gazette of Montenegro", No. 17/08 of 11.03.2008, 44/10 of 30.07.2010, 40/11 of 08.08.2011)