- The InvestEU loan guarantee scheme for small and medium-sized enterprises (SMEs), households and housing companies promotes investment in clean technology solutions.
- The guarantee scheme enables enterprises and housing companies to acquire funding for their green transition projects on more favourable loan terms and with lighter collateral than usual.
- The loan guarantee scheme is set to be implemented by banks in the early part of 2023. Some banks have already launched it.
The InvestEU loan guarantee scheme for SMEs, households and housing companies promotes investment in clean technology solutions. The model allows funding to be allocated to investments that improve the energy efficiency of buildings, for example. According to Finance Finland’s information, banks have shown strong interest in the scheme.
“The energy renovations of buildings, for example, should be in high demand right now, and this scheme makes it easier for housing companies to get loans for the renovations”, says Finance Finland’s Adviser Jussi Kettunen.
Two of the key challenges of the near future include supporting the green transition of companies and creating economic growth and new jobs. The objective of the InvestEU programme is to facilitate the acquisition of funding for investments that promote the green transition, and also to enable SMEs to implement their projects with less collateral.
The loan guarantee scheme is one example of how the objectives and recommendations of the Finnish working group on financing the green transition can be implemented. Set up by the Ministry of Finance, the Ministry of the Environment and the Ministry of Economic Affairs and Employment, the working group recently published its final report outlining financing measures to accelerate the transition in an economically, ecologically and socially sustainable manner.
“The financial system plays a key role in promoting green transition investments. Banks can steer the decisions of both households and businesses in a more sustainable direction”, says Kettunen.
The InvestEU guarantee scheme is still open for applications, and Finland’s share in the scheme can be increased if interest in it continues high. The scheme benefits not only customers and the environment, but banks as well. Finland is about to make a state aid notification of the guarantee scheme, and this notification is expected to ease banks’ reporting burden.
According to the current plan, loans from the guarantee scheme can be granted at least until the end of 2026.