About 40% of global greenhouse gas emissions come from the operations and properties of small and mid-sized businesses. Achieving global climate goals will therefore depend on individual businesses’ green strategies.
The European Investment Bank is hoping to encourage more green small business lending with a €200 million ($223.3 million) portfolio guarantee to BNP Paribas Leasing Solutions. The guarantee will cover loans for businesses in France, Germany, Italy and Spain that need capital to improve energy efficiency, invest in renewable energy projects, and adopt sustainable mobility and green technologies.
The EIB signed off on the guarantee via the European Investment Fund, a testing ground for equity and debt instruments for entrepreneurship, innovation, research and development, job creation, and the green and digital transitions in Europe.
The guarantee was made possible with capital from InvestEU, the bloc’s catalytic capital initiative, which aims to leverage €26.2 billion to encourage public and private investors to finance Europe’s small businesses, skills development and infrastructure projects. InvestEU was started to speed bloc countries’ economic recovery from the Covid pandemic and to “support the European economy in addressing new challenges arising from major uncertainties linked to the global and security outlook.” The initiative was launched just 10 days after Russia invaded Ukraine.
The European Investment Fund’s share of the InvestEU pot is €12.2 billion, with which it hopes to mobilize €159 billion from other backers.
