The European Investment Fund (EIF) and Bank Gospodarstwa Krajowego (BGK) are doubling their support for loans to a total of PLN 4 bilion (c. €950 million) for over 18,000 small businesses and entrepreneurs across Poland. The agreement is part of the COSME programme, the European Commission’s programme for small and medium-sized enterprises (SMEs), supported by the Investment Plan for Europe, the Juncker Plan.
Previous agreements with the EIF signed in 2015 amended and restated in 2017, helped BGK to launch a new and effective guarantee product and to support additional financing for SMEs, without requiring hard collateral (e.g. a mortgage) at favourable conditions. During the past 3 years, BGK has already supported more than 7,000 SMEs and entrepreneurs through COSME guarantees. Today's top-up agreement will allow banks cooperating with BGK to continue providing loans with BGK’s guarantees with substantially reduced collateral requirements. The agreement has the backing of the European Fund for Strategic Investments (EFSI), which is the central pillar of the Juncker Plan.
The increase was announced during the AECM annual meeting in Warsaw. Speaking at the signature ceremony, EIF Deputy Chief Executive, Roger Havenith said: “We are delighted with the success of the COSME EFSI transactions with BGK in Poland and pleased to be announcing an increase for additional SMEs today. The increased demand for SME loans with reduced collateral requirements, demonstrates the need for EU support for Polish companies. I am convinced that the continuous cooperation with BGK - EIF’s long-term partner - will ensure that many more Polish entrepreneurs with limited access to finance will be able to grow their businesses and create new jobs”.
BGK President, Beata Daszyńska-Muzyczka said: "BGK joined the AECM in 2009, when the annual value of guarantees granted amounted to EUR 10 million. This year, we plan to provide them 250 times more - up to EUR 2.5 billion. For years, BGK has created conditions for the development of Polish entrepreneurs, and we know from experience that the guarantee is the most effective instrument to support them. We are pleased that thanks to the cooperation with EIF, it will be possible to double the support for such a large group of small and medium enterprises."
EU Commissioner for Internal Market, Industry, Entrepreneurship and SMEs, Elżbieta Bieńkowska said: "Less than a year ago, BGK signed an agreement with the European Investment Fund to double their support to SMEs in Poland with the backing of the EU's budgetary guarantee, and today this is being doubled once again. Thanks to our joint efforts and enhanced cooperation with BGK we have provided small businesses with access to finance: already 7,000 SMEs have benefitted from this Polish-EU cooperation. Europe's economy depends upon its entrepreneurs. Keep up the good work."
The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance. EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment. More information on EIF's work is available here.
Bank Gospodarstwa Krajowego (BGK) is Poland’s main partner in supporting socioeconomic growth of the country. BGK as well as the entities of the capital group actively support the entrepreneurship and development programmes of the government by initiating and taking part in cooperation between enterprises, the public sector, and financial institutions.
BGK implements actions aimed to support the economic growth of Poland by financing infrastructure projects, local government projects, export projects and by co-financing the foreign expansion of Polish companies. In order to stimulate entrepreneurship and the development of micro, small and medium enterprises, BGK offers guarantees and sureties - BGK is a leading guarantee institution in Poland.
For more information about BGK’s: visit www.bgk.pl
The National Contact Point for Financial Instruments of the EU Programmes
(NCP) facilitates access to preferential financing, generated through EU support, for polish entrepreneurs and financial institutions. The NCP engages in information and promotional actions as well as consultancy. The NCP supports implementation of all EU programmes that involve financial instruments for entrepreneurs, including instruments supported by the Investment Plan. NCP’s services are provided throughout the country and are free of charge. The NCP is located within the Polish Bank Association, under a special partnership agreement. It operates on the basis of a Resolution of the Polish government and is supervised by the Minister of Entrepreneurship and Technology, Polish SME Envoy by EC. More about the NCP’s support: www.InstrumentyFinansoweUE.gov.pl
COSME is the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (SMEs) running from 2014 to 2020 with a total budget of EUR 2.3 billion. At least 60% of the programme will be devoted to easing access to finance for SMEs in Europe, with two financial instruments. The COSME Loan Guarantee Facility supports guarantees and counter-guarantees to financial institutions to help them provide more loans and lease finance to SMEs. This facility also includes securitisation of SME debt finance portfolios. The COSME programme also invests through the COSME Equity Facility for Growth in equity funds that provide risk capital to SMEs mainly in the expansion and growth stages. The COSME programme builds on the success of the Competitiveness and Innovation Framework Programme (CIP) (2007-2013) which helped to mobilise more than EUR 21 billion of loans and EUR 3 billion of venture capital to almost 400,000 SMEs in Europe.
Businesses can contact selected financial institutions in their country to access EU financing: http://www.access2finance.eu/
About the Juncker Plan
The Investment Plan for Europe focuses on breaking down barriers to investment, providing visibility and technical assistance to investment projects and making smart use of new and existing financial resources. More information on EIF's work under EFSI is available here. The EFSI is already seeing results. The projects and agreements approved for financing under EFSI so far are expected to mobilise more than EUR 294 billion in total investments across 28 Member States and to support around 644 000 SMEs. Based on this success, on 14 September 2016 the European Commission proposed extending the Plan, increasing its capacity and duration and reinforcing its strong points. The European Parliament and Member States adopted the "EFSI 2.0" Regulation in December 2017. The latest figures on EFSI by sector and country can be found here.