Loans and guarantees for SMEs - The JEREMIE Initiative in Cyprus

This case study illustrates how financial engineering instruments co-financed by the European Regional Development Fund (ERDF) were used in Cyprus, a Member State with no prior experience of this type of support, to address the lack of finance for small and medium-sized enterprises (SMEs). The financial products (loans with lower interest rates and lower collateral requirements than commercial bank loans) supported the sustainable development of over 500 Cypriot SMEs, contributing to regional development in Cyprus.

Close cooperation between all parties and a shared commitment to finding solutions helped overcome the challenges of a rapidly changing economic environment to achieve the successful implementation of the instrument. The later amendment of the regulatory framework, which allowed for working capital financing, further improved the attractiveness of the financial products for SMEs and accelerated the implementation of the financial instruments.