EstateGuru prepares to launch EIF-backed SME credit facility
EstateGuru is preparing to launch a diversified credit fund for institutional investors backed by the European Investment Fund (EIF).
The European peer-to-peer lending platform will launch the Estateguru Senior Secured Credit Fund, which will provide small- and medium-sized enterprises (SMEs) in Europe with senior financing originated via the online lending platform, focused mainly on Estonia, Latvia, Lithuania, Finland and Germany.
The fund is a closed-ended private debt fund available for qualified investors who seek exposure to this asset class. It’s first close is expected around the end of the second quarter of 2022.
The EIF, which is part of the European Investment Bank Group and has the main aim to support SMEs by helping them to access financing, has committed to being a cornerstone investor of the fund.
It will use resources from the European Guarantee Fund that was set up to ensure that European SMEs have sufficient financing available to mitigate the economic impact of the pandemic, and are able to continue their growth and development.
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“With the fund we are creating an attractive opportunity for institutional investors,” said Judith Tan (pictured), head of capital markets at EstateGuru.
“It will give them access to the underserved European SME property-lending market estimated at €400bn (£335.4bn).
“Digital lending platforms like EstateGuru are able to serve this market more effectively than traditional lenders and gain market share rapidly, while also offering a good return for senior secured risk to investors.”
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“With the backing of the pan-European Guarantee Fund, we are delighted to support EstateGuru, a fast-growing marketplace lender that aims to provide quick and flexible financing to companies in the Baltics, Finland and Germany,” said Alain Godard, chief executive of the EIF.
“The small size of target companies means that the loan amounts are small too, so SMEs have limited appeal for traditional banks and are in need of alternative sources of finance. Supporting them is key to overcoming the ongoing crisis caused by the pandemic.”
