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BGK and EIF unlock billions for small and medium enterprises in Poland

Bank Gospodarstwa Krajowego (BGK) has signed an agreement with the European Investment Fund (EIF) for additional resources to support Polish small and medium-sized enterprises (SMEs). Thanks to this agreement under the European Union’s SME programme COSME, the supported SME loan volume is expected to reach a total of PLN 10.5 billion (equivalent to almost €2.5 billion). The financial envelope available to SMEs within the scheme has already increased tenfold since its establishment: from the original PLN 800 million to PLN 8.4 billion.

This increase of the portfolio under the COSME programme results from the agreement signed by BGK and EIF that raised the available guarantee limit to PLN 8.4 billion. The agreement is backed by the European Fund for Strategic Investments (EFSI), the financial pillar of the Investment Plan for Europe.

Thierry Breton, European Commissioner for Internal Market, said: “Looking at the uptake of loans in the past four years, it is clear that the collaboration between BGK and the European Investment Fund under the COSME programme has been a great success. Already some 22,000 small businesses in Poland have benefited from improved access to finance to build and grow their companies. With this additional boost agreed today, even more Polish SMEs will feel the effects of the EU’s support.”

Włodzimierz Kocon, Vice-President of the Management Board of Bank Gospodarstwa Krajowego, said. “Bank Gospodarstwa Krajowego, in cooperation with the banking sector, creates solutions that provide opportunities to those enterprises who find it difficult to obtain a loan. COSME is a very important programme that enables the Polish economy to grow even faster. For almost four years of the programme’s operation, we have issued over 25,000 guarantees for 22,000 entrepreneurs in a total amount of more than PLN 4.4 billion. Therefore, I am extremely glad that the agreement signed today with the EIF provides us with as much as PLN 8.4 billion as guarantees for micro-, small and medium entrepreneurs. These resources enable us to guarantee loans worth of as much as PLN 10.5 billion”.

EIF Chief financial officer, Alessandro Tappi, added: “Supporting SME growth is the core business of the European Investment Fund. We are delighted to work jointly with the European Commission and BGK to mobilize funding for Poland’s smaller businesses and accompany them in their development. COSME has proven to be a very effective guarantee scheme and the increase of its limit is proof of the strong demand in the Polish economy for this type of financing.”

BGK was the first bank in Europe to sign a COSME agreement with the EIF under the European Fund for Strategic Investment (EFSI) in 2015.

The guarantees will secure loans worth of PLN 10.5 billion, and the signing of the agreement will also enable micro, small and medium companies to benefit under the programme that makes it easier to obtain loans for development and day-to-day operation one year longer, i.e. until the end of October 2021. The total amount of credits secured with COSME guarantees so far amounts to PLN 5.5 billion.

Where to get the guarantees

COSME guarantees are offered by 11 banks cooperating with BGK: Alior Bank S.A., BOŚ S.A., Bank Pekao S.A., ING Bank Śląski S.A., mBank S.A., PKO Bank Polski S.A., Nest Bank S.A., Santander Bank Polska S.A., cooperative banks, i.e. Bank Spółdzielczy in Brodnica, SGB-Bank S.A. as well as BPS Group and their associated cooperative banks.

A COSME guarantee is issued under the COSME Programme and the European Fund for Strategic Investments established under the Investment Plan for Europe. The EFSI allows the EIB and EIF to finance more, and often riskier, operations; and provides SMEs with better access to finance. The process of implementation of COSME guarantees is supported by the National Contact Point for Financial Instruments of the European Union Programmes.

Background information

Bank Gospodarstwa Krajowego is a state development bank – the only institution of this kind in Poland. The bank actively fosters the country’s economic and social growth. By implementing strategic development projects, it finances, inter alia, the largest infrastructure investments, makes it easier for Poles to purchase apartments and stimulates the entrepreneurial spirit of Polish companies, both domestically and abroad. It invests in funds whose assets are managed by the Polish Development Fund. The bank’s employees are highly competent as regards the implementation of projects that serve the country’s development. In assuring the country’s sustainable development, the bank is present in all regions of Poland. In 2018, it started its expansion by opening foreign branches – the first one launched in Brussels. BGK has unique experience in financing, investing, granting sureties and guarantees, as well as in distributing EU funds. It plays a significant role in the implementation of the Strategy for Responsible Development, which is a key document of the Polish economic policy. BGK’s activity is based on responsible, ethical and sustainable business, therefore the bank undertakes a wide range of initiatives that promote entrepreneurship, innovation, ecology and fair treatment of employees, partners and customers.

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 businesses by helping them to access finance. EIF designs and develops both venture and growth capital, guarantees and microfinance instruments, which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment.

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