The European Investment Fund (EIF) and the British Business Bank (BBB) have signed an agreement under the European Commission’s InnovFin initiative to help small and medium-sized enterprises (SMEs) in the UK access an estimated £30 million (ca. EUR 35 million) in additional financing. This transaction benefits from the support of the European Fund for Strategic Investments (EFSI), the heart of the Investment Plan for Europe. So far, the UK has been the second largest country of operation for EFSI backed financing with support going to renewable energy, a new hospital in Birmingham, smart meters and SME lending.
European Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: “Today’s agreement is excellent news for those innovative SMEs who would not otherwise have had the opportunity to obtain the finance they need to grow and create jobs. I am delighted that the Investment Plan is there to support them as they take their next steps.”
The Investment Plan focuses on strengthening European investments to create jobs and growth. It does so by making smarter use of new and existing financial resources, removing obstacles to investment, providing visibility and technical assistance to investment projects.
The InnovFin SME Guarantee Facility is established under Horizon 2020, the EU’s programme for research and innovation. It provides guarantees and counter-guarantees on debt financing of between EUR 25,000 and EUR 7.5 million in order to improve access to loan finance for innovative small and medium-sized enterprises and small mid-caps (up to 499 employees). The facility is managed by EIF, and is rolled out through financial intermediaries – banks and other financial institutions – in EU member states and associated countries. Under this facility, financial intermediaries are guaranteed by the EU and EIF against a proportion of their losses incurred on the debt financing covered under the facility.
The UK is regularly among the top beneficiaries of EU innovation grant funding, including in the latest rounds of the European Research Council’s (ERC) proof of concept grants which support researchers in bringing their ideas to market and Horizon 2020’s Fast Track to Innovation (FTI) scheme which does the same for SMEs. Historically, it has been the biggest recipient by far of the FTI scheme since it was launched in January 2015.
(Source: European Commission)