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The European Investment Fund (EIF) and ProCredit group have signed an agreement to increase lending to innovative small and medium-sized enterprises (SMEs) as well as small mid-caps under InnovFin – EU finance for innovators, an initiative supported by the European Commission.

The new agreement allows ProCredit group to provide finance to innovative companies with a total of EUR 250 million via its ProCredit banks in Albania, Bosnia and Herzegovina, Bulgaria, The Former Yugoslav Republic of Macedonia, Moldova, Romania and Serbia. These banks benefit from the support of a guarantee provided by EIF and backed under Horizon 2020, the EU Framework Programme for Research and Innovation. This is the first umbrella InnovFin SME guarantee signature covering these countries, enabling these ProCredit banks to offer innovative companies additional financing at favourable conditions.

EIF Chief Executive, Pier Luigi Gilibertsaid: “I am pleased to be signing this InnovFin SME Guarantee agreement with ProCredit group for the benefit of innovative companies. We have worked with the ProCredit group previously and are sure that they will be able to support innovative and growing businesses in need of finance”.

Carlos Moedas, European Commissioner for Research, Science and Innovation, said: "The EU-backed loan agreement signed today is open to SMEs and small midcaps in EU Member States as well as countries associated to Horizon 2020 in South-East Europe. Its objective is to help boost investment in innovative companies to promote jobs and growth."

Borislav Kostadinov, member of the management board of ProCredit Holding added: “We are proud that ProCredit is the first group of banks to sign the umbrella InnovFin SME Guarantee for its operations in Albania, Bosnia and Herzegovina, Bulgaria, Macedonia, Moldova, Romania and Serbia. This will stimulate innovative ideas and investments by our clients and thus enable them to increase their competitiveness. Asthe leading “house bank” for small and medium-sized enterprises” in this region, we know that modern technology, innovative thinking and environmental orientation are key factors for future development. This applies equally to our clients and to our own operations as banks.”

The aim of the InnovFin SME Guarantee is to encourage banks or other financial institutions to lend to SMEs and small mid-caps (firms with fewer than 500 employees) in need of investment and/or operating capital to finance research, development and innovation activities, with EU financial support. Financial institutions are being selected by the EIF following a call for expression of interest for financial intermediaries across Europe.