Over 315 million EUR of additional guarantees for EU small businesses financing

EIF is prolonging its existing guarantee agreements with European banks, microfinance providers and guarantee institutions, resulting in an extra 315 million EUR of guarantees covering SMEs’ financing through the EU Competitiveness and Innovation Framework Programme (CIP).

SMEs will continue to benefit from easier and better access to medium to long-term investment loans, working capital financing and micro-finance thanks to the extended guarantee agreements.

The CIP guarantee is provided for free to financial institutions which take on additional risk, in order to continue providing access to finance in light of the financial and economic crisis.

The EIF’s decision to extend agreements with these financial institutions is based on a healthy demand in the markets from small businesses.

Financial institutions listed below, benefiting from these recent extensions are active in Belgium, France, Germany, Slovenia and Spain:
•    Fonds de Participation
•    SOCAMA / Banques Populaires
•    Kreditanstalt für Wiederaufbau
•    Javni Sklad Republike Slovenije za podjetnistvo (Slovene Enterprise Fund)
•    Compania Espanola de Reafianzamiento (CERSA)
•    Microbank de la Caixa

As of September 2009, these six financial institutions had already granted or guaranteed more than 45,000 loans worth over EUR 2 bn to SMEs and micro-enterprises.

Background information:
The Competitiveness and Innovation Framework Programme (CIP), which spans from 2007 to 2013, has been put in place to boost European productivity, innovation capacity and sustainable growth, whilst simultaneously addressing complementary environmental concerns.
Within the framework of the CIP, the European Investment Fund (EIF) has been allocated EUR 1.1bn to be split between venture capital – with the High Growth and Innovative SME Facility (GIF) - and guarantees – with the SME Guarantee Facility (SMEG).
Under the SMEG, financial institutions are encouraged to enhance access to finance for SMEs.  The facility offers an excellent tool to allocate additional financing volumes for those SMEs that would not otherwise have access to resources and financial engineering instruments because of the increased lending risk entailed. As such, the SMEG complements and broadens EIF’s own product offering.
The EU CIP SMEG Facility gives the EIF the opportunity to play an essential role in supporting sustainable job creation and entrepreneurship in European SMEs.

About EIF

he EIF central mission is to support Europe’s SMEs by helping them to access finance.  EIF designs and develops venture capital and guarantees instruments which specifically target this market segment. In this role, the EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment.

For further information, please contact David Yormesor, d.yormesor@eif.org