Froda expands partnership with EIF unlocking €150M for SMEs

Froda, a provider of capital to SMEs, has strengthened its partnership with the European Investment Fund (EIF) by securing an additional lending capacity of €100 million.

This builds on an existing €50 million guarantee, bringing the total to €150 million. It also extends Froda’s financing reach across all 27 EU member states. 

This makes Froda the first company to establish an EU-wide microfinance partnership with the EIF, providing critical financing support to SMEs across Europe. EIF leverages various guarantee programs to expand financing options for SMEs.

Froda is a Swedish fintech company that provides financing to small and medium-sized businesses (SMEs). Froda's goal is to make it easier for business owners to access financing, and to help them grow their businesses. Essentially, they act as a digital lender that uses technology to simplify the business loan process for SMEs, offering an experience with minimal paperwork and quicker decision-making. Since 2021, Froda has focused on developing embedded finance solutions as the cornerstone of its international expansion. 

Since 2022, it has partnered with the EIF to improve access to financing for micro-enterprises, businesses with fewer than ten employees, in Sweden SMEs financed through Froda experienced an average growth of 131% within their first year after receiving financing. With €150 million in lending guarantees, Froda aims to replicate the efforts in Sweden on a wider scale to 10,000 SMEs across Europe. 

"The extended support from EIF represents a pivotal step in our mission to unlock growth opportunities for SMEs throughout Europe. By enabling our Embedded partners to expand into new markets, this partnership is set to transform the landscape of SME financing. Our vision is to create a financing ecosystem that fosters cross-border expansion for both Froda and our partners," said Olle Lundin, CEO and co-founder of Froda.

"The InvestEU program is built to provide scalable, impactful solutions for microfinancing. We’ve witnessed how EIF’s targeted guarantees in Sweden have enabled Froda to unlock growth for micro-enterprises. Expanding this model across the EU, I am confident that our strengthened partnership will build a robust, sustainable financing infrastructure that supports Europe’s entrepreneurial backbone," added Marjut Falkstedt, CEO of EIF.