Citadele Bank invests €10m in SME Finance
Latvia’s Citadele Bank has invested an initial €10 million in a new partnership with fintech start-up SME Finance, reports Jane Connolly.
The deal sees Citadele become the first bank in the Baltics to team up with a non-bank lending platform to provide factoring services.
Small and medium-sized enterprises (SMEs) will be offered account opening and cash management services by the bank.
“Business companies are especially important contributors to the Baltics economy; therefore, Citadele is looking for ways to support these companies beyond providing banking services itself,” says Vaidas Žagunis, head of corporate banking for Baltics and member of the management board of Citadele Bank. “The newly established cooperation will allow supporting SMEs’ business growth by offering faster, more flexible and tailor-made financing alternatives.”
Mindaugas Mikalajunas, CEO of SME Finance, says the timing of the partnership is perfect.
“Surveys conducted by the EU Commission show that Lithuania occupies leading positions in the EU in regard to relevance of factoring services to companies and actual usage of factoring services among businesses,” he says. “Towards the end of 2019 trade credit assets of Lithuanian non-financial corporation rose by 12% and reached historical highs – this is a clear indication that Lithuanian companies are becoming increasingly reliant on trade financing services.”
The deal follows news that Citadele has formed partnerships with European lending platform Fellow Finance and German fintech CrossLend.