The Fund of Funds Invites Banks in Bulgaria to Apply for New Financing under the Recovery Programme

The additional funds will be made available in response to the high level of interest and the expedient negotiation of available funding under the programme


In response to the challenges posed by the COVID-19 pandemic, the Bulgarian government has developed and launched a Recovery Programme (the Programme) — a portfolio guarantee to enable banks in the country to accelerate the provision of new loans in support Bulgarian enterprises and their recovery.

On account of the high interest of enterprises and the expedient negotiation process, and taking into account the ongoing need to improve access to financing for Bulgarian businesses, the Fund of Funds (FoF) offers all banks in Bulgaria the opportunity to apply for fresh financing under the Recovery Programme. The funds will be made available under Operational Programme Innovation and Competitiveness 2014-2020 as part of the European Union's response to the COVID-19 pandemic under the REACT-EU Priority Axis 6 Recovery of SMEs. The total amount of additional resources to be provided by the FoF under the Guarantee Facility is BGN 96 170 000.

The aim of the Programme that we continue to work on is to facilitate the access of businesses to recovery loans. Businesses will be able to access fresh financing, mainly to cover their current liquidity needs, to funds for new investments, transformation and growth. The terms and conditions of the guarantee ensure that loans can be disbursed within short timeframes, with a minimal administrative burden and without the need for material collateral.

The FoF will underwrite up to 50 % of the partner banks' credit risk arising from the SME loan portfolio created by each bank, covering 80 % of each individual loan extended under the Guarantee Facility.

The parameters of the Recovery Programme are as follows:

  • Access to business loans to eligible Bulgarian SMEs with a history of at least 3 years;
  • No requirement for tangible collateral; unsecured credit except for personal guarantees provided by owners;
  • Obtaining approval and the possibility of loan utilisation within a short timeframe;
  • Possibility to negotiate a 12-month grace period;
  • Scheduling of principal repayment over a period of up to 84 months;
  • Minimizing the administrative burden for the client;
  • Possibility to receive financing of up to BGN 3 million, but not exceeding 70 % of the turnover for 2019 or 2020, whichever is higher up to the de minimis threshold for State aid.

All financial institutions with a valid banking license and lending authorisation may participate in the selection of partners for the disbursement of the additional financing available from the Fund of Funds until 6 p.m. on October 25, 2021. All application documents are available on Fund’s website.