Greece is expanding financial support for small and medium-sized businesses with an additional €400 million in European recovery funds. The government expects the new guarantees to help unlock approximately €5 billion in bank financing.
The initiative is part of a new phase of the SME Competitiveness Guarantee program under InvestEU. It aims to make loans more accessible to Greek businesses seeking to invest, expand operations or cover working capital needs.
The Greek Ministry of National Economy and Finance announced the expansion on November 5, following an event organized by the European Investment Fund (EIF).
Representatives of participating financial institutions signed cooperation agreements to implement the new phase.
How the €5 Billion Financing Plan Will Work
The additional €400 million will come from the European Union’s Recovery and Resilience Facility.
Rather than distributing the entire amount as direct grants, the program will use financial guarantees to help participating banks provide loans to eligible businesses.
These guarantees reduce part of the lending risk for financial institutions, potentially allowing companies to access financing on more favorable terms.
The government estimates that the additional resources could support a new financing portfolio worth approximately €5 billion.
However, that figure represents a projected financing capacity, not money already distributed to businesses.
The program will support investment projects as well as working capital requirements.
For smaller companies, access to financing can be a major obstacle when purchasing equipment, adopting new technologies or expanding commercial operations.
By sharing lending risks with banks, the initiative seeks to improve access to credit for businesses that might otherwise struggle to secure funding.
The latest expansion builds on an earlier phase of the program.
According to the Greek government, the first phase used €400 million in recovery funds to support three guarantee instruments focused on sustainability, competitiveness and digital transformation.
Those instruments have already helped channel more than €3.65 billion in financing to over 17,000 Greek small and medium-sized enterprises.
The government is now seeking to extend that support through the new agreements.
Greece Seeks Stronger Business Growth Through European Funding
Deputy Minister of National Economy and Finance Nikos Papathanasis described the expansion as another stage in Greece’s cooperation with the European Investment Fund.
The government sees improved access to financing as an important tool for encouraging private investment and strengthening the competitiveness of Greek companies.
European Investment Bank Vice-President Giannis Tsakiris also emphasized the importance of directing financial resources toward businesses capable of generating economic activity and innovation.
The new guarantees form part of a broader effort to channel European recovery funding into the Greek economy.
According to the ministry, recovery-related initiatives have already mobilized more than €12.5 billion in financing for small and medium-sized businesses.
With additional support through InvestEU and the Hellenic Development Bank, the government expects total SME financing support to exceed €22 billion in the coming years.
Those figures reflect different programs and financing periods rather than a single new funding package.
For businesses, the next step will be the implementation of the agreements by participating financial institutions.
The government has not yet announced one common application date or a complete set of lending conditions for the new phase.
Individual banks will provide further information about eligibility requirements and available financing products.
The expansion could offer new opportunities for Greek entrepreneurs seeking to modernize their operations and compete more effectively in domestic and international markets.
However, its economic impact will ultimately depend on how much financing businesses obtain and how successfully they use the funds for productive investment.
