The European Investment Bank (EIB) has signed an €80 million credit line with Ringkjøbing Landbobank to finance Danish smaller businesses, as new lending to small and medium-sized enterprises (SMEs) fell 8% in 2024.
The EIB announced the facility Nov. 6, while its project record lists the signing date as July 9. The bank said the loan is about DKK 598 million.
SMEs are allocated at least 70% of the financing, and mid-caps may receive up to 30%. The EIB's announcement earmarks at least 15% of the financing for climate-action and environmental-sustainability projects.
The EIB forecasts more than 100 loans under the facility, €224 million in investment mobilized and about 5,000 full-time jobs sustained across Danish SMEs and mid-caps. It gave no time horizon for the projections. The bank also expects borrowers to gain access to lower-cost borrowing and longer-term financing, but did not provide rates, maturities or a timetable for the first subloans.
The Organisation for Economic Co-operation and Development (OECD) reported that new lending to Danish SMEs by financial institutions declined from DKK 46 billion in 2023 to DKK 42 billion in 2024. The OECD uses loans below €1 million as a proxy for SME lending. The EIB's project record says smaller companies face difficulty accessing long-term, competitively priced funding amid geopolitical uncertainty and tighter financial conditions; that is the bank's assessment.
EIB Vice-President Ioannis Tsakiris said, “Access to long-term finance is essential to help businesses invest, grow and adapt to future challenges.” The EIB says its partnership with Ringkjøbing Landbobank began in 2002. The bank's annual report says it joined a previous €100 million EIB program at the end of 2023 and began on-lending in 2024. The EIB's 2024 announcement set a minimum 25% allocation for climate-related investments and sustainability projects.
