- European Investment Fund (EIF) and Bank Gospodarstwa Krajowego (BGK) sign new agreement under Cultural and Creative Sectors (CCS) Guarantee Facility of EU's “Creative Europe” Programme.
- The pilot programme aims to generate PLN 525 million (c. EUR 125 million) in new financing for almost 3,000 SMEs in the cultural and creative sectors in Poland.
- Project supported by the EU budget under the Juncker Commission’s Investment Plan for Europe.
The European Investment Fund and Bank Gospodarstwa Krajowego (BGK) have signed a counter-guarantee agreement for Polish SMEs, supported by the Cultural and Creative Sectors Guarantee Facility under the EU's Creative Europe programme.
The counter-guarantee agreement will allow BGK to widen its financing options to Polish SMEs most in need of fresh funding in the cultural and creative sectors, whose business model is hard to evaluate. In particular, BGK’s partner network of banks will support currently underserved sub-sectors including for example design, visual arts, books, music, architecture and cultural activities, with PLN 525 million (c. EUR 125 million) of loans over three years, backed by the Guarantee Facility. The presence of the counter-guarantee means that the EIF will reimburse BGK in the event that a borrower cannot pay back a loan.
In total, almost 3,000 SMEs in the cultural and creative sectors are expected to obtain access to finance as a result of this new agreement which was made possible thanks to the strong cooperation between EIF and BGK and with the support of the European Fund for Strategic Investments (EFSI), the central pillar of the Investment Plan for Europe, the Juncker Plan.
EIF Deputy Chief Executive, Roger Havenith, said: “The new pilot supported by the EU counter-guarantee incentivises Polish intermediary banks to significantly increase their lending volumes to SMEs active in the cultural and creative sectors. Access to finance is often limited for companies in the cultural and creative sectors, and these new agreements will help BGK to target new support for this sector. The Cultural and Creative sectors in Poland and across Europe will benefit from this EU-backed support.”
Andrus Ansip, Vice-President for the Digital Single Market, Tibor Navracsics, Commissioner for Education, Culture, Youth and Sport, and Mariya Gabriel, Commissioner for Digital Economy and Society said: "Supporting Polish SMEs to easily access financing solutions will stimulate creativity, innovation and risk-taking in the country's creative and cultural sectors. With this agreement we make it possible for SMEs in sectors like the visual arts or design to get bank loans, enabling them to drive innovation and job creation at local and regional level."
Beata Daszyńska-Muzyczka, President of the Management Board of BGK said: “The mission of BGK is to support the development of Polish companies. The new guarantee instrument is part of the implementation of the Strategy for Responsible Development. We will enable SMEs of the creative and the cultural sectors access the external funding. We estimate that approximately 3,000 Polish companies will benefit from guarantees in the first three years. Creative Europe Programme offers a genuine opportunity for the development of an industry which employs 300 000 people in Poland. The agreement signed today is another example of successful cooperation between BGK and EIF. Together with the banking sector, we create an effective system of entrepreneurship support with the use of EU financial instruments."
Professor Piotr Gliński, Deputy Prime Minister, Minister of culture and national heritage said: “Culture is a very important part of the economy – as shown by research, it is a dynamically growing industry that continues to create new jobs and new sources of income. The creative sector is one of the industries that is going to play an important role in the modern economy, and therefore, its development is of great importance to Poland and the Polish government. The Creative Europe Guarantee Facility we are developing today is a creative industry support mechanism without precedence. The facility will provide over half a billion zloty (around PLN 525 million) in preferential loans for the development of small and medium enterprises operating in the creative sectors in Poland. This will allow for a major qualitative change in the sectors of culture whose potential is currently not being fully exploited. It will also allow to use the resources of these rapidly developing sectors – such as audiovisual or computer and video games industry – to the maximum.”
The creative and cultural sectors represent more than 7 million jobs in the EU and account for 4.2% of the EU's GDP (source). Access to finance can be difficult to obtain for companies active within these sectors, primarily due to the intangible nature of their assets and collateral, the limited size of the market, uncertainty about demand, and also lack of financial intermediary expertise in addressing sector specificities.
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 (SMEs) by helping them to access finance. EIF designs and develops 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. www.eif.org
Bank Gospodarstwa Krajowego (BGK) is Poland’s main partner in supporting socioeconomic growth of the country. BGK as well as the entities of the capital group actively support the entrepreneurship and development programmes of the government by initiating and taking part in cooperation between enterprises, the public sector, and financial institutions.
BGK implements actions aimed to support the economic growth of Poland by financing infrastructure projects, local government projects, export projects and by co-financing the foreign expansion of Polish companies. In order to stimulate entrepreneurship and the development of micro, small and medium enterprises, BGK offers guarantees and sureties - BGK is a leading guarantee institution in Poland.
For more information about BGK’s: visit www.bgk.pl
About the Cultural and Creative Sectors Guarantee Facility and Creative Europe
Set up under the cross-sectoral strand of the Creative Europe programme, the Cultural and Creative Sectors Guarantee Facility is the first EU investment instrument with such a wide scope in the culture and creative sectors. Creative Europe is a 7-year programme (2014-2020) which has a budget of EUR 1.46 billion for the duration of the period. The objective of Creative Europe is to promote cultural diversity, encourage the circulation of European culture and creativity and strengthen the competitiveness of the cultural and creative sectors.
The Guarantee Facility already supports a wide range of SMEs in the cultural and creative sector across the EU. For instance, HiFilm, a Romanian production company, which help to produce films, advertising or TV shows. While undergoing a period of growth, the company faced significant cash flow difficulties to pay for production costs before receiving their final payments. Today, HiFi has a strong portfolio of productions in both Romanian and international cinemas, growing significantly.
About the Juncker Plan
The Investment Plan for Europe, the Juncker Plan, focuses on boosting investments to create jobs and growth by making smarter use of new and existing financial resources, removing obstacles to investment and providing visibility and technical assistance to investment projects. The European Fund for Strategic Investments (EFSI) is the central pillar of the Juncker Plan. It provides a first loss guarantee, allowing the EIB group to invest in more, often riskier, projects. The projects and agreements approved for financing under the EFSI so far are expected to mobilise more than EUR 344 billion in investments and support around 787,000 SMEs across all 28 Member States. The latest figures on EFSI by sector and country can be found here.
About National Contact Point for Financial Instruments of the European Union Programs (NCP)
NCP facilitates access to preferential financing for entrepreneurs and financial institutions. NCP provides information on all EU programmes that include financial instruments, it is also a part of Polish support system for implementation of the Investment Plan for Europe in cooperation with the EIB Group and BGK. More info available: http://www.InstrumentyFinansoweUE.gov.pl
27 September 2018