The European Investment Fund doubled its private credit fund activity to €711m in 2024, as it sought to provide finance to small and medium-sized businesses that would otherwise struggle to access finance.

The EIF’s annual report was formally adopted at the annual general meeting of EIF shareholders on April 30. Overall, the fund deployed €14.4bn last year.

The fund’s private credit activity jumped to €711m, “addressing challenges non-bankable SMEs face in accessing finance”, said Kamil Pruchnick, EIF senior regional representative for Poland.

Highlights included a first senior private credit mandate in Lithuania, and the first private credit fund ever in Bulgaria.

In Lithuania, the EIF partnered with the national development institution UAB ILTE to provide €191.6m for private credit providers to invest in Lithuanian companies, investing in up to five private credit funds.

“Access to finance for business in Lithuania is one of the lowest among EU countries,” said ILTE chief executive officer Dainius Vilčinskas in the report. “This step will allow companies to have more alternatives in choosing sources of financing.”

The EIF invested €20m into Empower Bulgaria, the first institutional private credit fund in Bulgaria. 

“The EIF’s investment is expected to be critical in generating fundraising traction and catalysing additional resources from institutional investors to help the fund reach a viable size and deploy its strategy to address market gaps in alternative financing solutions to local SMEs,” the report said. 

“The fund aims to provide senior secure debt financing solutions to SMEs and small mid-cap companies in Bulgaria, currently representing an underserved market segment in the context of decreasing SME bank lending activity due to capital constraints and lack of private credit providers in the region.”

Around half of the fund’s private credit and private equity activity volumes last year were focussed on the theme of sustainability, the report said.

The EIF achieved the first closing of the Asset Management Umbrella Fund Green Private Credit fund-of-funds at €60m, securing the participation of nine French mutual insurance companies. Its target size of €200m “will unlock over €1bn worth of green financing”, the report said. 

“The objective is to provide institutional investors with direct access to the green private debt ecosystem, with a number of other private investors in the pipeline,” it continued.

According to the EIF’s accounts, private debt commitments sat at €711.3m. Leveraged volumes registered at €4.48bn, while mobilised volumes sat at €10.31bn.