The National Credit Guarantee Fund for Small and Medium Enterprises (FNGCIMM) will be able to provide financial guarantees through the INVEST EU program, thereby facilitating access for Romanian SMEs to a wide range of financial instruments and technical assistance to support investment projects and initiatives with significant economic and social impact.

On 24th June 2024, the European Commission communicated the official result of the pillar assessment to FNGCIMM, accepting it as an implementation partner under the InvestEU Program.

The positive result of the pillar assessment report and its approval by the European Commission reflects significant progress made by FNGCIMM SA IFN in defining an institutional status fully compatible with EU legislative and operational requirements. Consequently, FNGCIMM SA IFN will become the first guarantee fund approved by the EC for a partnership within InvestEU, joining EU financial institutions such as the European Investment Bank, the European Investment Fund, the Development Bank of the Council of Europe, and the European Bank for Reconstruction and Development, as well as other prestigious financial institutions from Italy, France, Spain, the Netherlands, Belgium, Hungary, Poland, Bulgaria, and the Czech Republic.

“This letter of acceptance marks the successful conclusion of a complex verification process, both nationally and at the level of the European Commission. It is a project we launched three years ago, which now opens a much broader perspective for financing Romanian SMEs. We are also transferring to the European guarantee program the risk that the Romanian state and the state budget have assumed over the past years, which, between 2020 and 2023, provided about 85,000 guarantees worth 54.3 billion lei to support SME access to finance. Through the eighteen government guarantee programs, we have provided a record number of guarantees at the European level, reflecting the Romanian entrepreneurial sector's willingness to access more sophisticated financial instruments. These guarantees have not only ensured a significant capital infusion into the economy but have also encouraged banks to finance the SME sector, which in turn was stimulated to develop more sustainable business plans and adopt business ethics to become bankable,” stated Dumitru Nancu, director of FNGCIMM.

InvestEU Fund Overview

The InvestEU Fund, the most important component of the InvestEU Program, is an instrument created to support investments in priority areas of the European Union to address market failures or suboptimal investment areas. The program operates through four policy lines reflecting the EU's key political priorities: (1) Sustainable Infrastructure; (2) Research, Innovation, and Digitalization; (3) SMEs; and (4) Social Investments and Skills.

Upon receiving the Confirmation Letter from the European Commission, FNGCIMM SA IFN will be able to initiate procedures to participate in the second call for selecting implementation partners under the InvestEU Program organized by the European Commission in 2024, for which funds amounting to 1.37 billion euros (EU guarantee) have been allocated.

Proposed Guarantee Products for Selection by the EC

Health & Medical Portfolio Capped Guarantee

The portfolio capped guarantee will support access to working capital and investment loans for beneficiaries in the medical sector and related fields, for providers of health and social services in all forms of organization of medical and health activities under private initiative, including small and medium-sized enterprises with medium market capitalization and large companies.

• Maximum guaranteed amount: up to 200,000 EUR per operation/loan
• Coverage rate: up to 80% of the loan facility, with 25% covered by FNGCIMM and 75% by the EU guarantee.
• Applicants: SMEs or any other private forms of organizing medical activities in the growth stage starting from the fourth year of activity.
• Minimum 20% of the total project cost should be financed from the beneficiaries' own resources.

Guarantees for Loans Aimed at Energy Efficiency of Individual Homes

The objective of this guarantee is to facilitate access to financing for renovations to improve the energy efficiency of individual buildings. Beneficiaries are individuals who own (at least 50%) an individual home they wish to renovate to improve its energy efficiency.

• Maximum financing: 100,000,000 euros, with the maximum guaranteed financing value being up to 50,000 euros.
• Coverage rate: up to 80% of the loan facility, with 16% covered by FNGCIMM and 64% by the EU guarantee.

ScaleUp Guarantees

Eligible beneficiaries are enterprises that have at least 10 employees three years before the date of the latest submitted financial statements and whose average annual growth rate of turnover or the number of employees was greater than 10% based on the average of the last three completed financial years.

• Maximum financing per operation: 1,000,000 EUR
• Credit institution coverage rate: 350,000 EUR (35% of the credit)
• Guarantee rate: 650,000 EUR, with 325,000 EUR (32.5% of the loan) covered by the EU guarantee and 325,000 EUR (32.5% of the loan) covered by the implementation partner.
• Support will be provided for financing for 7 years for investments, and 3 years for credit lines with the possibility of extension for another 3 years.

Sustainable Agriculture Portfolio Capped Guarantee

Beneficiaries include all categories of farmers, including SMEs, small enterprises with medium market capitalization, and large enterprises, starting from three years of activity.

• Maximum financing per operation: 200,000 EUR
• Risk coverage: up to 80% by the EU guarantee, with 25% covered by FNGCIMM.