Capitalia and the European Investment Fund (EIF) have signed an agreement on a guarantee instrument supporting small businesses in Latvia, Lithuania and Estonia, for a total amount of €10 million. With this guarantee, small businesses will get better access to finance.
The agreement is supported by the European Fund for Strategic Investments (EFSI), the heart of the Investment Plan for Europe, and by the Employment and Social Innovation (EaSI) programme
Marianne Thyssen, Commissioner for Employment, Social Affairs, Skills and Labour Mobility, said: "Giving small entrepreneurs the means put their talent to work with better access to finance is one of our key priorities. This is how we will build a fairer and a more inclusive European Union."
Head of Inclusive Finance at EIF, Per-Erik Eriksson said: “With the support of the EU’s EaSI programme, Capitalia will be able to scale up its micro and small business lending activities in line with its strategy to maintain its unique market position as alternative financing provider in the Baltics. This expansion of its activity is expected to provide a significant impact in terms of financial and social inclusion in all three Baltic countries and EIF is pleased to support this aim.”
“We are very pleased that Capitalia is the first private alternative financing institution in the Baltics that has qualified for this reputable guarantee program. Conclusion of this deal with EIF means that we will be able to provide loans to businesses at more favorable rates and without collateral requirements. Under this program companies will be able to receive financing of up to €25 000,” explains Juris Grišins, manager of Capitalia.
In order to qualify for the EaSI guarantee companies should have turnover below €2 million and have no more than 9 employees. Financing to businesses will be provided for term of 3 months to 5 years. Companies can apply for the loan and find other qualifying criteria through the webpage of Capitalia www.capitalia.com. The EaSI Guarantee under the Programme for Employment and Social Innovation (EaSI) is funded by the European Union. The European Commission has selected the European Investment Fund to implement the EaSI Guarantee.
Capitalia is the leading alternative financer for small and medium enterprises in the Baltic States. Operating since 2007 it has financed more than 5000 businesses in Latvia, Lithuania and Estonia, investing over €50 million in their development. In addition to loans, Capitalia provides venture capital as well as fundraising and other investment banking services.
About the Programme for Employment and Social Innovation
Under the European Programme for Employment and Social Innovation (EaSI) the European Commission supports microfinance and social entrepreneurship finance with an overall envelope of €193 million for the 2014-2020 period. The aim is to increase access to microfinance, i.e. loans of up to €25 000, in particular for vulnerable persons and micro-enterprises. In addition, for the first time, the European Commission is also supporting social enterprises through investments of up to €500 000. The microfinance and social entrepreneurship support is first implemented through the EaSI Guarantee, which shall enable microcredit providers and social enterprise investors to reach out to entrepreneurs they would not have been able to finance otherwise for risk considerations. The European Commission has selected the EIF to implement the EaSI Guarantee.
About the Investment Plan for Europe
The Investment Plan for Europe, known as the “Juncker Plan”, is one of the European Commission’s top priorities. It focuses on boosting investment to generate jobs and growth by making smarter use of new and existing financial resources, removing obstacles to investment, and providing visibility and technical assistance to investment projects.
The European Fund for Strategic Investments (EFSI) is the main pillar of the Juncker Plan and provides first loss guarantees, enabling the EIB to invest in more projects that often come with greater risks. EFSI has already yielded tangible results. The projects and agreements approved for financing under EFSI are expected to mobilise almost €380 billion in investments, and support 842 000 SMEs in the 28 Member States. More information on the results of the Investment Plan for Europe is available here.