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Latvia's Citadele Bank fuels SME Finance with EUR10 million investment

Source: Citadele Bank

Citadele Bank is launching a partnership with SME Finance, the largest non-bank factoring provider in the Baltics, and the initial investment is 10 M EUR.

The FinTech startup SME Finance provides alternative factoring services to small and medium enterprises in the Baltics and Poland. Citadele is the first bank in the Baltics to offer factoring services in cooperation with non-bank lending platform.

Thanks to this partnership Lithuanian small and medium sized companies will get a valuable financial support to use when there is a need to maintain and develop their daily business. In addition, the bank will offer account opening and cash management services to these SMEs.

Vaidas Žagūnis, Head of Corporate banking for Baltics and member of the Management Board of Citadele Bank, says: “Business companies are especially important contributors of the Baltics economy; therefore, Citadele is looking for ways how to support these companies beyond providing banking services itself. The newly established cooperation will allow supporting SMEs’ business growth by offering faster, more flexible and tailor-made financing alternatives.”

Mindaugas Mikalajūnas, CEO of SME Finance, says: “We are thrilled to announce our partnership with Citadele as it will enable us to meet rapidly growing demand for non-banking factoring services among Lithuanian businesses. 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. Towards the end of 2019 trade credit assets of Lithuanian non-financial corporation rose by 12% and reached historical highs - this is clear indication that Lithuanian companies are becoming increasingly reliant on trade financing services. Lithuanian companies are increasingly looking for flexible trade financing solutions, and this is where the experience of SME Finance and Citadele bank teams comes in handy. I can only emphasize that our partnership Citadele comes at a perfect timing.”

Few months ago, Citadele has announced a partnership with Europe's most advanced lending platform, Fellow Finance, which brings together individuals, businesses and investors, and German financial technology (FinTech) company CrossLend that takes care of the securitization of the loan investments.

Citadele is the first bank in the Baltic states, and one of the first in Europe, to issue consumer loans through a peer-to-peer lending platform.

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