© Friends of Europe
© Friends of Europe

Innovative SMEs benefit from EU loans

The European Investment Fund (EIF) and ProCredit Bank, Ukraine, have signed a loan guarantee deal that will offer easier access to risk capital for developing innovative SMEs in Ukraine.

The EU-funded deal will allow the bank to enter into loan agreements with companies of below 500 employees more securely. Any potential losses on loans for innovative activities will be guaranteed by 50% by the EU under the loan guarantee scheme.

Overall, the scheme is to generate a portfolio of €50m in loans to innovative companies over the next two years.

Carlos Moedas, European commissioner for research, science and innovation, said: “I am pleased to announce that Ukrainian companies can now benefit from EU-guaranteed loans up to €50m to boost their research and innovation potential.

“The deal signed will support Ukraine’s economy, and it is a testimony to the productive relationship between the EU and Ukraine under Horizon 2020, the EU’s research funding programme.”

This deal falls under the EU Finance for Innovators (InnovFin) SME Guarantee Facility, which is part of the new generation of financial instruments supported under Horizon 2020.

Under this facility, financial intermediaries are guaranteed against a proportion of any losses incurred on the debt financing covered under the facility.