PARTNER CONTENT

On November 23rd, at the headquarters of the Lublin Agency for Enterprise Support (LAWP), representatives of Bank Gospodarstwa Krajowego (BGK) and financing partners signed agreements to launch the first loans for entrepreneurs under the European Funds for Lubelskie 2021-2027 program. The total value of entrusted funds for loans amounts to PLN 125 million.

The agreements concluded between BGK and the financing partners concern offering two financial products to Lublin entrepreneurs: a Development Loan and a Development Loan with Repayment Forgiveness. A total of 6 agreements were signed between BGK and the financing partners, who will be responsible for offering these loans in the region.

"We are well aware that it is micro, small, and medium-sized enterprises that are the fundamental link driving the region's economy. For this very reason, the key objective is to concentrate EU funds on investing in innovative ideas, stimulating businesses to undertake innovative actions, which will directly translate into the development of enterprises and, consequently, economic growth in the region," summarized Jarosław Stawiarski, Marshal of the Lubelskie Voivodeship.

"The agreements signed today are the first in the country that launch European Funds for enterprises within the framework of the Cohesion Policy for 2021-27. We are signing these agreements in the Lubelskie Voivodeship, which was the first to prepare a program for the utilization of new EU funds, and today we have another effect of this – we are launching development and investment loans for Lublin companies. The financing partners cooperating with BGK will launch application calls for loans within 30 days," stated Paweł Chorąży, Managing Director of the European Funds Division at Bank Gospodarstwa Krajowego.

Entrepreneurs will be able to use loan funds to finance investments related to equipping their businesses. This will allow enterprises to introduce new products/services/technologies to the market. As an additional element of the projects, support for the application of modern IT technologies will be possible. The Development Loan is preferential financing intended for entrepreneurs in the SME sector with a maximum value of PLN 2 million. The product is characterized by a very favorable fixed interest rate of 2%, a long 10-year repayment period, and an annual grace period. A novelty in this perspective is the introduction of a product combining debt financing with a grant – the Development Loan with Repayment Forgiveness (agreement with the BARR and OIC Poland consortium, valued at PLN 15 million). This means that in this product, there is a possibility of forgiving up to 25% of the loan principal if the entrepreneur's investment is in its early stage of development (i.e., existing for no longer than 3 years) or returning to the market after previous liquidation of business activity within the same period, and meets at least one of the following conditions:

• the planned investment project will be implemented in marginalized areas or in medium-sized cities losing socio-economic functions;
• the planned investment project aligns with at least one regional smart specialization;
• the planned investment project will be implemented by a micro-enterprise.

The total value of entrusted funds is PLN 125 million. The financing partners who will grant the loans are: Development Loan Product

• Consortium: Lubelska Fundacja Rozwoju and Polski Fundusz Gwarancyjny – value of entrusted funds: PLN 30 million;
• Consortium: Biłgorajska Agencja Rozwoju Regionalnego S.A., Polska Fundacja Ośrodków Wspomagania Rozwoju Gospodarczego „OIC Poland”, Fundacja „Puławskie Centrum Przedsiębiorczości” – value of entrusted funds: PLN 26 million;
• Consortium: Lubelska Fundacja Rozwoju and Polski Fundusz Gwarancyjny Sp. z o.o. – value of entrusted funds: PLN 22 million;
• Polska Fundacja Przedsiębiorczości – value of entrusted funds: PLN 18 million;
• Part V – Biłgorajska Agencja Rozwoju Regionalnego S.A. – value of entrusted funds: PLN 14 million;

Development Loan with Repayment Forgiveness Product:

• Consortium: Biłgorajska Agencja Rozwoju Regionalnego S.A.
• Polska Fundacja Ośrodków Wspomagania Rozwoju Gospodarczego „OIC Poland” – value of entrusted funds: PLN 15 million.

Source of Funds The launch of attractive loan offers would not have been possible without the decisions of the Management Board of the Lubelskie Voivodeship, the administrator of EU funds under the European Funds for Lubelskie Program, which entrusted BGK in April this year with the management of approximately PLN 316.8 million of EU funds under Measure 2.6 SME Support. Nearly PLN 269 million of this amount are EU funds from the Cohesion Policy for 2021-27, and the remaining PLN 47 million is national contribution, which comes from the repayment of liquidity loans granted to SMEs from the Operational Program Smart Development. European Funds – How it Works at BGK From the funds entrusted by the Lubelskie Voivodeship, BGK established a Trust Fund, from which it selects financing partners through tenders. They will offer attractive loans to entrepreneurs in the region, which they will use to finance, among other things, investments enabling them to introduce new products, services, or technologies to the market. The agreements signed today are just the first instruments from a wide range of financial products that BGK will offer to Lublin entrepreneurs and local governments. Soon, the offer of EU loans in the Lubelskie Voivodeship will expand to include instruments focused on the development of renewable energy sources and improving energy efficiency. More information can be found on the website for Development Loans and Development Loans with Repayment Forgiveness