25 Percent of Russian Businesses Declared Bankruptcy Due to High Inflation, High Interest Rates and No Export Customers

Hit by a triple whammy of soaring loans, plummeting sales, and evaporating state support, many small-and medium-sized companies (SMEs) are teetering on the verge of disaster.

Nearly one in four Russian small businesses are on the “brink of collapse”, according to the former head of Ukraine’s National Bank.

Late last year, Russia’s Central Bank hiked interest rates to a record high of 21%.

The head of the bank, Elvira Nabiullina, was forced into the move, as she attempts to curb runaway inflation.

Further interest rate hikes have not been ruled out, with some experts predicting a rate of 22% by the end of the first quarter.

Hit by a triple whammy of soaring loans, plummeting sales and evaporating state support, many small to medium sized companies (SMEs) are teetering on the verge of disaster.

The Small Business Index has sunk to a two-year low, and 35% of SMEs expect even tougher days ahead.

In a post to his X social media account, Kyrylo Shevchenko wrote: “Nearly 1 in 4 Russian small businesses is on the brink of collapse.

“As sanctions tighten the grip, consumer spending free-falls, and banks slash loan approvals, 31% of entrepreneurs now steer clear of borrowing entirely.

“Russia’s small business sector is suffocating under its own weight — and the Kremlin’s chokehold.”

Russian consumers face a further blow to purchasing power as credit card interest rates hit new highs.

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