• The EU4Business Guarantee Facility will support small and medium businesses in Eastern Partnership countries, with a strong focus on Ukrainian firms which have been heavily hit by the consequences of Russia's invasion.
  • The new facility will improve access to finance in critical economic sectors, including trade and agriculture, by enhancing access to credit at favourable terms for local small and medium businesses.
  • The facility is expected to unlock €500 million in loans in the entire Eastern Partnership region, of which €375 million in Ukraine.
  • This initiative is backed by the European Commission under the Neighbourhood Investment Platform (NIP).

As part of EU efforts to aid economic recovery, the EIB Group and the European Commission today launched the EU4Business Guarantee Facility. The initiative will improve access to finance for small- and medium-sized enterprises (SMEs) in Ukraine and other countries of the European Union's Eastern Partnership. The new facility, to be deployed in partnership with local financial intermediaries, amounts to €40 million, of which €30 million will be dedicated to Ukraine while the rest will be made available to banks in Moldova, Georgia, Armenia and Azerbaijan. The facility will be implemented by the European Investment Fund (EIF), the European Investment Bank (EIB) Group’s subsidiary responsible for small and medium businesses. 

The facility is expected to unlock €500 million in lending and provide substantial support to local small and medium businesses in the entire Eastern Partnership region, helping them access credit on favourable terms and increasing their resilience during these challenging times.

Signed on the margins of the Ukraine Recovery Conference in London, this financial package will help small and medium businesses deal with the consequences of Russia’s war in Ukraine and facilitate a re-orientation towards the EU economy.

SME portfolio guarantees are one of the key products deployed by the EIB Group in Ukraine over the years to support small and medium businesses. The product works by transferring SME credit risk from financial institutions to the EIB Group, ensuring access to financing and improved lending terms for small and medium businesses. The EIF began working in Ukraine in 2016 in a joint EIB Group programme supported by the European Commission. Under that facility (the Deep and Comprehensive Free Trade Area (DCFTA) Facility), the EIB Group has supported €300 million in lending to Ukrainian small and medium businesses and €55 million in lending in Georgia and Moldova. In January 2023, the EIB Group reviewed the deployment of the DCFTA Facility and agreed with its partner banks in Ukraine to support a further €125 million lending under it.

The new EU4Business guarantee facility is expected to unlock €375 million in lending in Ukraine and an additional €125 million in the other four countries.

Executive Vice President of the European Commission and European Commissioner for Trade Valdis Dombrovskis said: “Investment in Ukraine’s recovery and reconstruction must start immediately. Today we demonstrate our resolve to mobilise finance for Ukraine’s recovery, backing the process of reconstruction. Our commitment is unwavering. The more Russia continues its aggression against Ukraine’s civilians, infrastructure and economy, the more steadfast we will be in our drive to reconstruct Ukraine. We will work hand in hand with international partners and the business community to help rebuild a democratic, united and prosperous Ukraine on its path to the European Union.”          

EIB President Werner Hoyer said: “The war has caused a sharp deterioration in the business environment not only in Ukraine but in all of the European Union’s Eastern Partnership countries. With disrupted trade routes, closure of the ports, internal displacement of persons and businesses, and the constant threat of destruction of critical infrastructure, businesses in Ukraine and other Eastern Partnership countries require quick assistance. In addition to weapons, the Ukrainians urgently need financial assistance to keep the economy going. The EIB Group is committed to providing solutions now, where they are most needed, as part of the EU support efforts. I am proud that with the European Commission, the EIB Group will be able to support small and medium businesses and improve conditions in the war-torn Ukrainian economy.”   

EIF Chief Investment Officer Alessandro Tappi said: “The European Investment Fund has been very committed in supporting lending to small and medium businesses in Ukraine. We started to work in Ukraine seven years ago, guaranteeing up to €415 million worth of loans. Earlier this year we reviewed our support and approved an increase of the guaranteed volume for a further €125 million of lending, providing much needed credit risk coverage for Ukrainian small and medium businesses in agriculture, manufacturing and trade. We look forward to implementing the EU4Business guarantee facility in close cooperation with the EIB, the European Commission and our partner financial institutions in Ukraine.”