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The financing needs of SMEs vary and depend on enterprise and project size and on the stage of the enterprise’s life cycle.

A starting enterprise seeks financing for initial investments and launching its operations, such as for the acquisition of the initial inventory or investments in furnishings. The average financing or guarantee for a bank loan granted by Finnvera to a starting small enterprise was EUR 60,000 in the year 2015.

Enterprises operating on the domestic market often seek financing not only for working capital but also for investments in machinery or for various situations of change, such as changes of generation or other ownership arrangements.

A growth enterprise may need financing, for instance:

  • for the acquisition of a machine or equipment
  • for working capital, owing to reasons such as seasonal variations and maintenance of a merchandise inventory
  • for the development of a product or service
  • for expansion on the export market.

An internationalising enterprise needs to finance expansion outside Finland, for instance, through a company acquisition or by establishing a subsidiary, a joint venture, or an office abroad. Aside from working capital, Finnvera provides financing for both pre-delivery and post-delivery security associated with the export transactions of internationalising enterprises.

The financing or guarantee offered by Finnvera for international growth was in 2015 on average EUR 500,000. The largest individual cases of financing may be several millions of euros.

Finnvera shares risks with other providers of financing, and banks play an important role in financial arrangements. Before the financing decision, Finnvera assesses the enterprise as a whole, its potential for success, business, competitiveness, and the ability to manage its financial obligations. The decision on financing and Finnvera’s contribution is made on the basis of this analysis.

In 2015, Finnvera received over 12,800 financing applications from SMEs. About 80 per cent of these got a positive decision. Applications may be rejected due to, for example, an insufficient share of the necessary self-financing, problems in the entrepreneur’s or enterprise’s credit history, a tough competitive situation in the respective sector, or because the enterprise is not considered to have the prerequisites for profitable business.

Read more about project assessment at Finnvera.

At the end of 2015, the outstanding commitments for SME financing stood at EUR 2.7 billion (2.8).

Despite the uncertain economic situation, the number of client enterprises that went bankrupt or wound up business was smaller than the year before, in total 831 (922).

Financing for working capital and changes of ownership

Demand for SME financing was the highest during the first few months of the year. Demand declined during the second half of the year, but the total for the year was higher than the year before. The total value of the projects for which financing was sought came to EUR 2.3 billion. Investments were at a modest level; as in previous years, demand focused on working capital.

Finnvera granted a total of EUR 1,116 million in financing to SMEs and to companies larger than the SME definition used by the EU. Loans and domestic guarantees accounted for EUR 906 million of the financing; this was 19 per cent more than the year before. The factors contributing to this increase included: the mandate granted to Finnvera at the start of 2015 to provide financing for companies larger than SMEs, changes of ownership, which showed an increase after many years, and the restructuring of financing granted earlier. About 950 enterprises received financing for ownership changes. The total sum was EUR 116 million. The value of guarantees granted to SMEs for exports totalled EUR 210 million, or 13 per cent less than the year before.

Financing granted to
local small enterprises
in 2015

Rural trades Industry Tourism Services to business Trade and consumer services
1.30 36 25.10 36.90 49.70

Financing granted to enterprises
operating on the domestic market
in 2015

Rural trades Industry Tourism Services to business Trade and consumer services
7.10 313.30 28.10 87.40 75.70

Financing granted for growth and internationalisation by business area in 2015

Rural trades Industry Tourism Services to business Trade and consumer services
0.40 220.10 0.10 64.900 20.100

Ownership changes

  2011 2012 2013 2014 2015
Changes in ownership 135.40 117.90 107.90 87.60 116.50

"Well-functioning markets for ownership changes support dynamics in the SME field and thereby both economic and social development.”

- Katja Keitaanniemi, Executive Vice President, SMEs

A new guarantee, known as the Start Guarantee, was taken into use in April. It is intended for the financing of starting enterprises that have been in business for no more than three years. Altogether 992 enterprises received guarantees for loans granted by banks. The total sum was EUR 45 million.

Case image

Case: KPA Unicon: Customer financing opens doors

KPA Unicon of Pieksämäki, Finland, opened an export window to South Africa. Financial arrangements played a very important part for the success of the export project.
Read more

Finnvera continued the SME Export Finance Programme, launched in 2012. The aim of the programme is to inform SMEs of the various tools available for financing exports.

Read more about the SME Export Finance Programme.

Cooperation with Team Finland actors was intensified, and a new service model for domestic operations was taken into use during the year under review. Team Finland concentrates on about 2,000 Finnish enterprises whose strategy is to grow internationally. The range of services includes market analysis, consultancy and training, networks, social relations, visibility and financing both for the development stage and for exports and trading on the market.

Case image

Case: Team Finland assists companies to go international

Companies seeking growth through internationalisation are served by the Team Finland network, which covers all State-funded internationalisation and innovation services.
Read more

Reforms of methods and products to continue

Systematic contacting of potential clients was started during the period under review. The feedback was overwhelmingly positive and has already led to a few major financing decisions. The proactive approach is continued by seeking new clients and by going through our clientele to identify enterprises capable of growing or renewing.

The reform of the internal structure, initiated in 2014, was continued. Together with increasing digitisation, its aim is to improve the productivity of work in accordance with the goals set by the owner.

The new tasks assigned to Finnvera in the Government Programme were prepared late in the year. In spring 2016, Finnvera and the Federation of Finnish Enterprises will launch a national ownership change programme and will begin to grant junior financing. It is estimated that the granting of risk sharing guarantees included in the financing programme of European strategic investments can start during the second half of the year.


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