News from 25-09-2013

Bpifrance and EIF sign a EUR 200 million agreement to support innovative businesses in France

Bpifrance and the European Investment Fund (EIF) have signed a guarantee agreement to support lending to SMEs under the Risk Sharing Instrument (RSI), a joint initiative of the European Investment Bank Group and the European Commission.

The new agreement allows Bpifrance Financement to provide EUR 200 million of loans to innovative companies, with the support of a 40% EIF guarantee with EU financial support under the Seventh Framework Programme for Research and Development (FP7). Bpifrance Financement has developed a specific product (“Prêt pour l’innovation” - PPI) for innovative SMEs and Small Mid-caps in France, offering reduced interest rates and collateral requirements thanks to the Risk Sharing Instrument.

This is the second RSI agreement in France, bringing the total loan finance available to innovative businesses across the EU under this initiative to well above EUR 1 billion with 15 operations signed in 11 countries so far. The agreement signed today will help the bank to target more innovative businesses across the country.

Bpifrance CEO, Nicolas Dufourcq, noted: “I am delighted to be signing this agreement which will help innovative small and medium sized enterprises overcome the “Valley of Death” – the gap in financing between a research project and a commercial product or process. As Bpifrance is a major provider of funding for innovative companies through research or innovation support schemes, the financing will be rolled out very quickly".

European Commissioner for Research, Innovation and Science, Máire Geoghegan-Quinn, welcomed this second signature under RSI in France "This agreement is an excellent example of how we can work together at EU level and with public banks, in order to help innovative companies access risk finance. Financing research and innovation and helping those SMEs who take risks to bring ideas to the market will mean more jobs and growth in France and across Europe."

The RSI facility aims to encourage banks to provide loans of up to €7.5 million to SMEs and Small Mid-Caps undertaking research, development or innovation, and seeking finance for investments and/or working capital. The RSI is a joint initiative of the EIF, the EIB and the European Commission. It is supported by the European Union under the FP7 and uses EIF's risk-taking capacity. It is part of, and complements, the existing Risk Sharing Finance Facility (RSFF), managed by the EIB.

Under this facility, EIF is providing guarantees to banks and leasing companies that lend to SMEs and Small Mid-Caps. The guarantee covers, upon default, up to 50% of the outstanding amount of each loan. 

The call is open to financial or credit institutions, established and operating in the EU and/or countries associated to FP7, including, Iceland, Liechtenstein, and Norway, Switzerland, Israel, Turkey, the former Yugoslav Republic of Macedonia, Serbia, Albania, Montenegro, Bosnia & Herzegovina, the Faroe Islands and Moldova.

Source: EIF