Romanian State Bank Established for Management of €233 Million Cohesion Policy Fund, Targeting Small and Medium Enterprises
Romanian Investment and Development Bank Launches Regional Participation Fund for SMEs
The Investment and Development Bank (IDB), a Romanian government-established entity, has announced the launch of the Regional Participation Fund, a financing instrument worth EUR 233.35 million. The Fund, designed to support Small and Medium Enterprises (SMEs) in the regions covered by the North-East, South-East, and Bucharest-Ilfov Regional Programs, was initiated by the Managing Authorities for these regions and is funded through a combination of European Regional Development Fund (ERDF) contributions, state budget allocations, and resources from the respective regional programs.
The Regional Participation Fund offers a unique financing structure, combining a zero-interest loan covering up to 70% of the investment value with a grant component equal to 40% of the investment value, paid out upon successful completion of the investment. SMEs cannot apply directly to the Fund but must go through selected financial intermediaries, which will be chosen by the IDB through a transparent, non-discriminatory, and objective procurement process expected to conclude by the end of 2025.
The IDB, registered in the Register of Development Banks on January 3, 2025, according to the National Bank of Romania, will manage the Fund on behalf of the regional managing authorities. The source of the information about the Fund was announced by the IDB, with no mention of the National Bank of Romania as a contributor.
The Regional Participation Fund aims to stimulate regional economic development by providing SMEs with favorable financial conditions, combining low-cost loans and grants, which can significantly ease financing barriers for investments. However, further details regarding exact eligibility criteria for SMEs, specific application requirements, or deadlines were not found in the available information. The selection process for financial intermediaries will play a key role in access and implementation.
In summary, the Regional Participation Fund is a publicly managed financing mechanism through IDB, sourcing European and national funds, offering SMEs zero-interest loans plus grants via selected intermediaries in specific Romanian regions. The Fund's launch represents a significant step towards supporting the growth and development of SMEs in Romania.
[1] Cursdeguvernare.ro, "Regional Participation Fund," accessed on March 15, 2023. [2] European Commission, "Cohesion Policy Programme in Romania 2021-2027," accessed on March 15, 2023.
Small-business owners in the covered regions can seek financing through the Regional Participation Fund, a EUR 233.35 million funding mechanism managed by the Romanian Investment and Development Bank (IDB). This fund offers a unique combination of zero-interest loans and grants, aiming to provide favorable financial conditions for small-business investments and stimulate regional economic development.
