What are businesses borrowing for? Financing is geared towards equipment. Companies avoid exchange rate risk
In July 2025, Albanian businesses took out a total of 19.1 billion lek in new loans, but how they used this money says a lot about their priorities and challenges. According to the “Scan Intel” analysis, the largest part of the loan, almost 40%, went for overdraft, i.e. to cover immediate liquidity needs. However, compared to a year ago, this amount has fallen by over 14%, signaling a slightly lower short-term pressure for cash.
At the same time, financing for the purchase of equipment has significantly strengthened. Businesses have taken out 4.2 billion lek loans for this purpose, a slight increase compared to last July, but with a large change in currency. While a year ago the bulk of equipment loans were in euros, this year lek dominates. The amount provided in local currency has almost doubled, indicating that companies are increasingly investing in modernization, while avoiding exchange rate risk.
Real estate has also seen a significant rebound. Credit for this segment reached 3.8 billion lek, about 15% more than a year ago. Interest is distributed almost equally between lek and euro, which indicates that businesses are looking at both the domestic market and the opportunities offered by foreign currency financing. In contrast, working capital has declined significantly, falling to 3.5 billion lek or about 20% less than in July 2024, which suggests less need for financing of inventory and daily liabilities.
The currency landscape is also significant. The Lek has taken the lead, accounting for over 61% of business loans, while the euro has fallen below 39%. Dollars have almost completely disappeared from the scene, with a decline of 99.9% compared to levels seven years ago. This is a clear sign of the de-dollarization process of the financial market in Albania.
So, July 2025 brings a double picture, businesses still rely heavily on overdrafts for liquidity, but at the same time are increasingly directing financing towards equipment and property, choosing the lek as the main currency to protect themselves from exchange rate fluctuations.
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