The European Investment Fund (EIF) has provided a guarantee that will enable ProCredit Bank Ukraine to offer small and medium-sized enterprises (SMEs) financing of up to EUR 143 million on favourable terms.
Funding amount and business coverage
The guarantee allows ProCredit Bank to finance more than 700 companies across the country, and overall the bank will be able to support up to 715 Ukrainian enterprises. The initiative is implemented with the support of the European Union (EU) under the Ukraine Investment Framework and is the third agreement under the programme Ukraine Facility Partial Portfolio Guarantee.
Terms of lending and target groups
The guarantee covers part of the risks that ProCredit Bank assumes when lending to businesses, allowing it to increase the volume of financing and offer more favourable terms. In particular, some of the funds are expected to be provided in hryvnias (UAH), and the loans will feature lower collateral requirements and longer repayment terms.
Priority will be given to companies affected by Russia’s war against Ukraine, businesses led by war veterans, and firms founded by women and young entrepreneurs. The financing is intended to support operational activities, preserve jobs and carry out investment projects.
Programme overview and remarks from officials
The participation of local partner banks is expected to provide Ukrainian businesses with access to financing of more than EUR 1.1 billion across the country under the EU-supported programme.
“Despite the war, Ukrainian entrepreneurs continue to run their businesses and preserve jobs,” said Karl Negammer, vice-president of the European Investment Bank (EIB) Group, during his visit to Ukraine today. “Thanks to this EU-supported guarantee, we help businesses gain access to the financing they need to ensure resilience, make further investments and contribute to the recovery of the Ukrainian economy.”
“The European Union remains a reliable partner of the Ukrainian private sector and supports its key role in ensuring economic resilience and the country’s recovery,” said Gediminas Navikas, Chargé d’Affaires of the Delegation of the European Union (EU) to Ukraine. “Through the EIB Group’s partial portfolio guarantee mechanism under the Ukraine Investment Framework, we help Ukrainian businesses access more affordable financing to preserve jobs, invest and grow even during the war.”
“Supporting Ukrainian business today means much more than simply providing financing. It is about preserving the country’s economic potential and laying the foundation for future growth and recovery. The guarantee from the European Investment Fund expands our ability to finance small and medium-sized enterprises that continue to invest, create jobs and adapt to the challenges of war. It enables us to turn European support into tangible economic activity across Ukraine,” said Oleksandr Povshednyi, Chairman of the Management Board of ProCredit Bank.
