As a result of the changes, the EIB will target loans to SMEs totalling Euro15 billion over the next two years, an increase of around 50 percent each year compared with 2007, when it lent Euro 5.2 billion to SMEs.
In addition, the EIB announced it is to give a new Euro1 billion mandate to its European Investment Fund subsidiary to provide mezzanine finance to SMEs.
The increase in lending will accompany reforms to the EIB's SME loan product that should make loans both simpler and more attractive for companies and the EIB’s partner banks. The first of the new European Loan for SMEs is due to be signed in the coming weeks.
“For us it is not just a question of doing more, but above all doing better,” said EIB President Philippe Maystadt.
The reforms are a response to the results of a consultation of the SME lending sector carried out by the EIB in 2007 and 2008 and in the context of the European Commission’s proposed Small Business Act. The 23 million SMEs in the European Union represent 99 percent of all businesses and accounted for 80 percent of new jobs created in the EU in recent years.
The EIB aims to provide companies with the financing necessary for them to fully benefit from the simplification of regulations proposed by the Small Business Act, thus supporting activity and European competitiveness.
The changes include a loosening in the definition of eligible investments, opening EIB finance up to a wider spectrum of small and medium-sized companies. By the end of the year, the EIB will also develop new products offering to share part of the risk that banks take on when lending to companies that are judged to represent a higher risk.
The EIB has been providing small companies with loans through intermediary banks since 1968. In 2005 supporting SMEs became one of the EIB's operational priorities. The planned increase in lending should increase the number of small companies that benefit from EIB finance from 150,000 to around 200,000 a year.