The European Investment Fund (EIF) has approved a new guarantee facility for Stockholm-based SME microfinancing provider Froda, unlocking €100 million in lending for micro-entrepreneurs across all 27 EU member states
The €100 million builds on an existing €50 million facility, bringing the total to €150 million.
Through digital processes and technological innovation, Froda has shortened the loan process for SMEs from months to minutes.
Froda has expanded across the Nordics, the UK, Ireland and Germany, partnering with industry leaders like Visa, Checkout.com, Lunar. Froda is a licensed credit market company under the supervision of the Swedish Financial Supervisory Authority.
The EIF deal extends Froda’s financing reach across all 27 EU member states. The agreement marks Froda as the first company to establish an EU-wide microfinance partnership with the EIF.
“This initiative, backed by InvestEU Microfinance, Social and Entrepreneurship Guarantee Product, becomes the first EU-wide microfinancing guarantee and underscores EIF’s commitment to bridging Europe’s microfinance gap and supporting economic growth through inclusive entrepreneurship,” said the EIF.
“Froda, a leader in micro-SME financing, will leverage this partnership to enhance access to capital for underserved micro-enterprises, particularly in vulnerable segments such as female entrepreneurs and sole traders.
“By combining EIF’s targeted guarantees with Froda’s innovative digital lending platform, the collaboration aims to address the financing challenges faced by Europe’s smallest businesses and drive significant economic impact.”
EIF CEO Marjut Falkstedt said: “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.”
The partnership with EIF positions Froda to significantly scale its digital lending capabilities and reach thousands of micro-entrepreneurs across the Nordics.
Froda’s platform integrates with major partners such as Visa, enabling efficient and scalable financing solutions.
Froda CEO and co-founder Olle Lundin said: “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.”