Pollen Street invests €35m in Lithuanian lender to fund SMEs
Pollen Street Capital has invested €35m (£29.5m) into Lithuanian lender Finbee Verlsui to fund small- and medium-sized businesses in the country.
Finnbee Verlsui lent out more than €27m last year and is targeting €40m of new originations in 2024.
Chief executive Tomas Mačiulaitis (pictured) said that increasing borrower demand has led to a funding gap, which the agreement with the alternative asset manager will help to address.
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“We already have supported over 3,000 customers since inception, with 2,000 active, and have maintained an average annual growth of 60 per cent in loan originations for the last five years,” he said. “We are thankful for the continued support from our investor community to finance these loans, but increasing customer demand has led to a funding gap. Until now, we have been increasing liquidity with our own funds, but this partnership will enable us to grow at much faster pace.”
The funding line will also enable the firm to pay out business loans more quickly and provide larger facilities, he added.
“Until now, it used to take over a week to crowdfund larger loans, while now it will take just a few hours from signing the contract to the money being in the account,” he said.
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“Moreover, regardless of the customer’s ability to borrow, we had to limit the maximum loan amount based on the liquidity on our platform. This means that if a relatively large business wants to borrow €100,000 and we assessed that it could borrow that amount, we still had to reduce it to €50,000. Now we will be able to lend as much as the real need is.”
Ethan Saggu, investment director at Pollen Street Capital, said: “As across much of Europe, there is increasing entrepreneurship and a growing demand for SME financing as the availability of bank capital is not sufficient to meet the demand.
“Finbee Verslui have developed an attractive product for Lithuanian SMEs looking to grow and we are excited to support them and their customers on this journey. We have been impressed by the management team and their commitment to prudent lending practices, and we look forward to promoting financial inclusion within the country.”
