European Investment Bank Funding for SMEs

Through an agreement with the European Investment Bank (EIB; www.eib.org) we are supporting small and medium sized businesses (SMEs) and enterprises having less than 3 000 employees (MidCaps) by providing access to an invaluable source of lower cost finance and flexible repayment schedules. Clients can receive beneficial interest rates compared to standard business lending conditions.

A European Cooperation for the benefit of SMEs

The EIB is the long-term lending bank of the European Union; its role is to finance investment projects in support of EU policy objectives. With a view to supporting EU external action, by decision of the European Parliament and of the Council, the EIB is granted an External Mandate  to finance corresponding projects outside the EU. 

Thanks to its best possible rating on the capital markets (AAA), the EIB can borrow funds on favourable terms, which it passes on to SMEs and MidCaps through us. The SMEs and MidCaps are specifically and individually informed by us of the EIB’s involvement and its impact on the financial terms of the loan received. Extensive information related to the EIB Group support to SMEs and MidCaps can be found on the EIB website (www.eib.org). 

• Borrowers: legal entities registered in the territory of the Republic of Serbia;

• Maturity: from 2 to 12 years;

• Grace period: up to 4 years;

• Repayment method: in instalments – one, three, six-month;

• Interest rate: floating and fixed;

• Currency: EUR currency clause and FX EUR.

What may the funds from this EIB line be used for:

• Purchase, reconstruction, or expansion of fixed assets,

• Intangible Assets:
  • RDI expenses,
  • Purchase of licenses, software, and other rights,
  • Purchase of intangible assets, such as licenses for using copyrights, patents, brand, signs, and similar assets, up to 10% of the total amount of the end user’s project cost,

• Working capital and permanent working capital.

The funds can be used to finance from very small projects to investments with a maximum cost of EUR 25million. The EIB’s contribution, however, cannot exceed EUR 12.5 million.

The funds from this EIB line may not be used for the following:

• Purchase of land unless it is necessary for the investment in technical terms (as described above, for the fixed assets),

• Purchase of agricultural land,

• Purchase of commission, licenses, rights for exploiting mineral sources and manufacturing rights in the agricultural sector,

• Funding of tax, such as VAT, 

• Funding of tariffs (taxes and liabilities paid in the course of import/export),

• Refinance of liabilities of other banks.

Erste Bank undertakes to inform the end users of this credit line on the realised loans from the EIB funds.

General Criteria of Borrower Eligibility:

• Independent small and medium enterprises (SME) defined as the enterprises with less than 250 full-time employees, including the FTEs of the affiliates, in accordance with the European Commission definitions,

• Independent Mid-Caps defined as the enterprises with minimum 250 and maximum 3000 FTEs. 

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Certain categories of the the activities of the borrowers may be deemed unacceptable to the EIB, in accordance with the EIB documents (Activity Nomenclature, Exclusion Policy) available on the EIB's web site, subject to the check by Erste Bank.