The European Investment Fund (EIF) signed guarantee agreements with Greece’s top four banks to mobilise up to about €4.5 billion in financing for small and medium-sized enterprises, the greening of the Greek economy, innovation, and the country’s digital transition. The InvestEU Member State compartment for Greece is backing the series of capped portfolio guarantees by using funds from Greece's Recovery and Resilience Plan (RRP).
The EIF, part of the European Investment Bank Group (EIB Group), is providing the guarantees to Alpha Bank, Eurobank, National Bank of Greece and Piraeus Bank, the country’s leading lenders and long-term partners of the EIB Group. This allows them to extend more financing to SMEs under favourable terms. The signature ceremony with all four banks took place on Friday in Athens and marks the start of the implementation of the EIF’s mandate. With the EU guarantee, the banks are now able to give eligible businesses across the nation much-needed financing.
“Thanks to the excellent collaboration with the Greek authorities, the European Commission and our first implementing partners, three guarantee instruments under the InvestEU programme, backed by RRF resources, are now available to support Greek small and medium-sized enterprises. This financial support will improve access to finance for Greek businesses, incentivizing investments in innovation and sustainability and driving the green and digital transition, which is fully in line with the strategic orientation of the Greek government, the EIB Group, and the EU,” said European Investment Fund (EIF) CEO Marjut Falkstedt.
The agreement reached today, according to Nikos Papathanasis, Alternate Minister of Economy and Finance, "is yet another important tool, but also additional proof of the role played by the resources from the Recovery and Resilience Fund in order to achieve the strategic goal of strengthening entrepreneurship and increasing the competitiveness, mainly of small and medium-sized enterprises, while at the same time expanding their lending capabilities from our banks." He added: “It also contributes to innovation and the green, digital, and just transition in the context of the national plan to modernize our production model through robust and sustainable development, with social cohesion, prosperity, and better income for all of our fellow citizens.”
“The InvestEU Credit Guarantee instrument, backed by funds from the Recovery and Resilience Plan ‘Greece 2.0', is devoted to small and medium enterprises, enabling their access to finance. Our cooperation with the EIF offers a concrete solution to a critical issue for Greek businesses by providing guarantees for investment loans and working capital, enhancing their competitiveness, sustainability, innovation, and digital transformation," said the Governor of the Recovery & Resilience Fund Agency, Orestis Kavalakis.
The EIF guarantee enables the partner banks to offer improved financing terms, such as lower interest rates, reduced collateral requirements, and reduced down-payment obligations for investment loans. Moreover, with the EIF guarantee, the banks can offer longer maturities and increased financing volumes and support excluded segments such as startups. The portfolio guarantee products offered are the Sustainability Guarantee, which aims at supporting financing of investments in climate action, energy efficiency, and renewable energy; the SME Competitiveness Guarantee, focusing on improving access to finance for SMEs; and the Innovation & Digitalization Guarantee, enhancing access to finance for R&D-intensive Greek enterprises and supporting the uptake of digital technologies and digital transformation of Greek SMEs and small mid-caps.
