The European Investment Fund (EIF), part of the EIB Group, has signed portfolio guarantee agreements with 11 banks and financial intermediaries in the Western Balkans economies. Funded under the European Union’s WB EDIF (Western Balkans Enterprise Development and Innovation Facility) Guarantee for SME Resilience Initiative, these agreements will enable local banks and financial institutions to build a portfolio of SME loans for an aggregate amount well above €750 million, along with those yet to signed in the first half of 2024.

These financial resources are intended to increase access to finance among small businesses and improve their resilience to ongoing economic distress, while creating conditions for business expansion, employment and innovation. In Montenegro, this facility is expected to deploy a total of €12 million worth of loans available at favourable lending conditions to some 222 small businesses, while sustaining over 3 000 jobs.

EIF Chief Executive Marjut Falkstedt said: “By supporting small businesses in the Western Balkans, especially in the most underserved and fragile segments, these extensive financial resources will improve these businesses’ capacity to innovate and grow, at the same time contributing to further integration within the EU economy. By doing so, these substantial funds will provide additional impetus for the development of robust and competitive regional economies, as well as their advancement within the global value chains.”

In Montenegro, EIF guarantees have unlocked around €120 million in total for around 4 900 small businesses, which has helped sustain over 36 000 jobs. 

 The Ambassador of the EU to Montenegro Oana-Cristina Popa added: "Initiatives like these are crucial not only for fostering private sector growth but also for enhancing Montenegro's overall socioeconomic progress. By providing loan opportunities for SMEs, the EIF's initiative simultaneously helps develop innovation and create employment opportunities. These funds are expected to substantially strengthen the private sector, addressing one of its primary obstacles — a lack of access to finance. Moreover, this initiative complements other EU-supported efforts. Namely, Montenegrin authorities plan to work on reducing business barriers and improving the overall business environment through the implementation of the Reform Agenda. Combined, these initiatives will jointly assist Montenegrin companies in preparing for the forthcoming single market integration process."

Background information

The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central mission is to support Europe's micro, small and medium-sized enterprises (SMEs) by helping them to access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, the EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment.