The European Investment Fund (EIF) and Erste Bank Podgorica have signed the first InnovFin SME Guarantee Facility agreement in Montenegro, to support innovative small and medium-sized enterprises (SMEs) and small mid-caps.
The new InnovFin agreement will enable Erste Bank to provide loans to innovative companies over the next two years with the support of a guarantee provided by the EIF and backed by Horizon 2020, the EU Framework Programme for Research and Innovation. The InnovFin guarantee covers 50 per cent of each loan disbursed by Erste Bank and is expected to generate a total loan portfolio up to EUR 30 million.
Carlos Moedas, Commissioner for Research, Science and Innovation, said: “Prosperity in Montenegro is a win for the country as well as for the EU. These loans to innovative SMEs and small mid-caps, backed by Horizon 2020, the EU research and innovation programme, will in turn create growth and jobs in Montenegro, giving a major boost to the economy.”
“We are delighted to be announcing the first InnovFin guarantee agreement in Montenegro for innovative businesses today,” added EIF Chief Executive Pier Luigi Gilibert. “This agreement allows Erste Bank in Montenegro to increase financing for SMEs and small mid-caps, which will be instrumental in supporting an innovation agenda in the country, delivering new products and services. Erste Group is one of EIF’s long-standing partners and we are confident that the InnovFin SME guarantee will quickly channel finance to SMEs and small mid-caps.”
Aleksa Lukić, Erste Bank CEO, said: “The InnovFin agreement is of great importance for Erste Bank since it enables us to open new opportunities and further improve the financing model for SMEs. Thanks to this guarantee scheme, healthy and innovative initiatives will have access to finance on more favourable terms. Small and medium-sized enterprises are drivers of growth and development. Therefore, I expect that 30 million euros of credit support under the InnovFin agreement will substantially contribute to the new wave of investments within this segment of the economy.“
The aim of the InnovFin SME Guarantee is to encourage banks or other financial institutions to lend to SMEs and small mid-caps (up to 499 employees) in need of investment and/or working 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.