Microfinance Focus July 1, 2011: The European Investment Fund (EIF) and Šiaulių bankas recently signed a EUR 5 million loan agreement to support micro-enterprises in Lithuania.

The agreement will allow Šiaulių bankas to provide enhanced access to finance to micro-entrepreneurs and, improve access to the credit market for women entrepreneurs in Lithuania.

The transaction was signed under the European Progress Microfinance Facility (Progress Microfinance), funded by the European Commission and the European Investment Bank and managed by the European Investment Fund.

The agreement will allow Šiaulių bankas to complement its current SME lending activity and scale up its micro-lending business. The transaction marks the continuation of the collaboration between the EIB Group and Šiaulių bankas, following the signature of two transactions by EIF and Šiaulių bankas under the JEREMIE (Joint European Resources for Micro to Medium Enterprises initiative) mandate in January 2010 (EUR 40 million) and in June 2011 (EUR 25 million) regarding the financing of SME as well as of two transactions by EIB in May and November 2010 for respectively. The financing comprised of EUR 6m and EUR 15m under the JESSICA (Joint European Support for Sustainable Investment in City Areas) mandate for the renovation and modernization of multi-apartment buildings in Lithuania.

The European Progress Microfinance Facility (Progress Microfinance) is an EU microfinance initiative established with EUR 200 million funding from the European Commission and the European Investment Bank.

EIF supports Europe’s small and medium-sized businesses (SMEs) by helping them access finance. EIF develops venture capital and guarantees instruments which specifically target this market segment.

Šiaulių bankas is controlled by the Lithuanian investors and the European Bank for Reconstruction and Development (EBRD). Its services are directed towards SMES and provision of financial services to individuals.