Update as of 6 April 2020: Based on the €1 billion unlocked from the EFSI under the COSME Loan Guarantee Facility and the InnovFin SME Guarantee under Horizon 2020, the EIF will provide guarantees worth €2.2 billion to financial intermediaries, unlocking €8 billion in available financing. The calls for expressions of interest as well as the updated terms have been published today.
Coronavirus: Commission and European Investment Fund (part of EIB Group) unlock €8 billion in finance for 100,000 small and medium-sized businesses
Today’s announcement fulfils the commitment in the Commission Communication of 13 March to bring immediate relief to hard-hit SMEs, with money able to flow already in April. It is part of the package of measures announced by the EIB Group on 16 March designed to rapidly mobilise support for Europe’s SMEs and mid-caps.
As of today, the EIF is offering to the market dedicated EFSI-backed guarantees to contain the impact of the pandemic on small and medium sized enterprises and small mid-cap companies.
Read the full press release here.
Mobilising up to EUR 40 billion and more
We understand that it is a very difficult time for many European small businesses that could be facing enormous challenges due to the #COVID19 crisis.
This is why, as an immediate response to the crisis, the EIB Group has proposed a plan to mobilise up to €40 billion of financing. This will go towards bridging loans credit holidays and other measures designed to alleviate liquidity and working capital constraints for SMEs and mid-caps.
The EIF, as the EIB Group’s specialist arm for SME financing will work through financial intermediaries in the EU Member States and in partnership with national promotional banks.
The proposed financing package consists of:
Dedicated guarantee schemes to banks based on existing programmes for immediate deployment, mobilising up to €20 billion of financing;
Dedicated liquidity lines to banks to ensure additional working capital support for SMEs and mid-caps of €10 billion;
Dedicated asset-backed securities (ABS) purchasing programmes to allow banks to transfer risk on portfolios of SME loans, mobilising another €10 billion of support.
All these actions can be implemented quickly to ease liquidity shortages and will be implemented in partnership with NPIs wherever feasible.
The EIB group is exploring possibilities to scale up its overall response to the coronavirus crisis.
“We are all living through trying times, and the EIB Group will work without pause to ensure the EU bank contributes to the rapid resolution of this terrible crisis,” said President Werner Hoyer in the EIB Group’s joint press release.
Information for financial intermediaries
A dedicated EIF Covid Infobox has been created for financial intermediaries to centralise any questions related to the EIF’s covid-19 response measures: covid-fi(at)eif.org
Calls for loan portfolio guarantees to intermediaries under EU programmes COSME LGF and InnovFin SMEG are published on our website. The EIF guarantees are supported by the EU budget under the European Fund for Strategic Investments (EFSI).
Accessing finance for SMEs and mid-caps
We will be publishing the list of EIF intermediaries for COVID-19 related financing support here as soon as the relevant financing agreements have been concluded.
Meanwhile you can check here the EIF’s current network of financial intermediaries in your country.