Since the onset of Russia’s full-scale invasion, Ukraine’s economy has faced unprecedented challenges. Despite the resilience of the banking sector — strengthened by pre-war reforms — corporate lending has been on a steady decline. This trend is driven by a combination of elevated risks, war-related disruptions, and structural barriers on both the demand and supply sides of the credit market.

At the same time, private sector lending is essential to Ukraine’s economic recovery. Access to affordable financing will be critical for maintaining business activity during the war and ensuring accelerated post-war reconstruction and growth. Recognizing this, the National Bank of Ukraine (NBU) and international partners such as the IMF have emphasized the importance of restoring lending to viable enterprises as part of broader financial sector strategies.

Together with German Economic Team our paper examines the core factors behind the stagnation in corporate lending and outlines practical steps to improve access to finance. The analysis is grounded in empirical methods and draws on national statistics, survey evidence, and econometric modelling to uncover the drivers of loan demand, supply, and borrowing costs.

By bridging analysis with actionable insights, this study contributes to the ongoing dialogue on unlocking credit in Ukraine and supports the design of targeted policies aligned with the NBU Lending Strategy and IMF recommendations.