Froda, a FinTech specialising in SME financing, has expanded its partnership with the European Investment Fund (EIF) by securing an additional €100m in lending capacity.
This builds on an existing €50m guarantee, bringing the total financing support to €150m. The agreement establishes Froda as the first company to secure an EU-wide microfinance partnership with the EIF, enhancing access to credit for small businesses across all 27 EU member states.
The SME financing gap in Europe is estimated at €400bn, leaving many small businesses struggling to access capital for growth and competition. To address this issue, EIF leverages guarantee programmes to expand financing options for SMEs. Froda has partnered with the EIF since 2022 to provide financing to micro-enterprises—businesses with fewer than ten employees—in Sweden. Businesses financed through Froda have shown an average growth of 131% within a year of receiving funding.
With €150m in lending guarantees, Froda now aims to replicate its success on a larger scale, supporting 10,000 SMEs across Europe. The extended agreement is expected to drive economic growth and innovation while improving financial access for micro-enterprises that struggle to secure fair financing.
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.”
The agreement also expands opportunities for Froda’s Embedded partners, allowing them to offer EIF-backed loans across the EU. By scaling innovative financial solutions, the partnership supports EIF’s objectives of promoting microfinance, entrepreneurship, and inclusive growth, aligning with the EU’s goals of digitalisation and equitable access to financing.
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.”
Since 2021, Froda has focused on developing embedded finance solutions as part of its international expansion. Through partnerships with banks, payment providers, and FinTech firms, Froda offers white-label SME lending services integrated into partner platforms, enabling businesses to access financing seamlessly.
Founded in 2015, Froda set out to revolutionise business financing by making it more accessible and efficient for SMEs. The company has expanded across the Nordics, the UK, Ireland, and Germany, partnering with industry leaders such as Visa, Checkout.com, and Lunar.
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