SME Finance has secured a new €100 million credit facility to fuel its mission of reinventing financing for Europe’s SMEs. The Vilnius-based team now takes one step closer to its 2023 goal of establishing an EU-wide fintech marketplace.
Small and Medium-sized enterprises (SMEs) are the backbone of Europe’s economy, accounting for approximately 99% of all businesses and making up 50-75% of the continent’s GDP.
Whilst these businesses are a pillar of society, they are under increasing pressure and surmounting challenges as economic uncertainty and societal instability hit. Legacy banking institutions have continued to follow a more conventional approach to financing, more suited to large enterprises. As a result, SMEs are suffering from a lack of banking and finance partners who are flexible and cater specifically to the rapidly changing landscape of SME reality: disrupted supply chains, warfare, shifting labour markets, a down economy, and rising costs.
SME Finance is offering a solution. The Vilnius-based fintech has now secured a new €100 million credit line from Fasanara Capital. It brings the total commitments from Fasanara to €240 million.
Mindaugas Mikalajūnas, CEO of SME Finance: “SMEs are a highly attractive credit market for major asset managers, like Fasanara, and we are excited to deepen our partnership. Our mission is to be the number one banking and finance partner for SMEs in Europe, and this extension of our credit facility will help us greatly in making finance accessible for every business. We believe strongly that this sector is one of the cornerstones of our economy, and there is a lot of demand right now for finance partners that speak the language of small- and medium-sized business.”
Founded in 2016, the fintech has already reached more than €1.3 billion in loan volume and invoice financing with over 2,500 growing businesses, using a digital-first approach that uses machine learning and open banking.
The Lithuanian company leverages AI, open banking and automation in its loan decision-making, financing, and customer onboarding. This shortens the process, simplifies it, and makes it more accessible to SMEs.
The aim is to become an EU-wide fintech marketplace where any business can access financial services ranging from traditional business loans to revenue-based financing to embedded finance solutions.
With offices in three Baltic countries plus Finland, in 2023 the company will expand its presence into The Netherlands and Spain, with further European offices planned.
Francesco Filia, CEO of Fasanara Capital: “This market has huge potential, with a highly-skilled labour force and innovative niches. It’s an area where Fasanara wants to increase exposure and, because many businesses there are still at an early stage of evolution, that means addressing the SME sector. Our 3-year partnership with SME Finance has been highly successful, creating solid foundations of trust between us. We are excited to be extending it now with a new €100 million line of credit to grow the geographical scope of operations and to encourage the next wave of entrepreneurs throughout the continent.”