Two major financial European institutions have agreed to aid the country of Montenegro, in order to finance some of its plans for better businesses.
Specifically, the European Investment Fund (EIF) and Erste Bank Podgorica have signed their first agreement (known as the InnovFin SME Guarantee Facility agreement), to support innovative small- and medium-sized enterprises (SMEs).
‘These loans to innovative SMEs and small mid-caps, backed by Horizon 2020, the EU research and innovation program, will in turn create growth and jobs in Montenegro, giving a major boost to the economy’, according to the Commissioner for Research, Science and Innovation, Carlos Moedas.
With the help of this agreement, Erste Bank will provide loans to companies operating in Montenegro, over the next two years. EIF will also play a big part in this financial operation, along with Horizon 2020, the EU Framework Programme for Research and Innovation. InnovFin covers 50% of each loan, expected to generate a total loan portfolio of up to 30 million EUR.
Erste Bank CEO, Aleksa Lukić explained the following: ‘The InnovFin agreement is of great importance for Erste Bank since it enables us to open new opportunities and further improve the financing model for SMEs. Thanks to this guarantee scheme, healthy and innovative initiatives will have access to finance on more favorable terms. Small and medium-sized enterprises are drivers of growth and development. Therefore, I expect that 30 million euros of credit support under the InnovFin agreement will substantially contribute to the new wave of investments within this segment of the economy’.
The aim of the InnovFin SME Guarantee is to encourage banks and other financial institutions to lend money to businesses with no more than 499 employees, those that are in need of investment for research, development and innovation.