Investment & Fund Management
The European Investment
Full Credential Description
The European Investment Fund (EIF) and Libra Internet Bank faced a significant challenge in Romania regarding access to finance for small and medium-sized enterprises (SMEs). Many SMEs struggled with high collateral requirements, which limited their ability to secure loans from traditional banking sources. To address this issue, the EIF and Libra Internet Bank signed a loan guarantee agreement under the EU's COSME program, aimed at enhancing the competitiveness of SMEs.
The tailored solution involved providing a guarantee that would allow Libra Internet Bank to increase its lending capacity over the next three years. This initiative was expected to leverage a portfolio of EUR 53 million, benefiting over 1,650 companies by significantly reducing collateral requirements for loans. Additionally, a separate EUR 2.5 million loan agreement under the Progress Microfinance initiative was established to improve access to finance for micro-entrepreneurs, particularly targeting self-employed young and rural entrepreneurs who typically face barriers in obtaining credit.
As a result of these agreements, Libra Internet Bank reported disbursing over 380 micro-loans amounting to ROL 30 million within the first ten months, demonstrating a rapid response to the financing needs of the local business community. This collaboration not only aimed to stimulate the Romanian economy by supporting SMEs but also marked a significant step in enhancing financial inclusion for underserved groups in the region.