EBRD provides loan for digital transformation of Turkish SMEs

ISTANBUL

The European Bank for Reconstruction and Development (EBRD) is providing a 25-million-euro loan to Turkish private lender DenizBank, which will on-lend to Turkish manufacturing small and medium-sized enterprises (SMEs) for investments in their digital transformation.

The loan comes under the EBRD’s Digital Transformation Financing Facility (DTFF), which provides financing to the country’s manufacturing SMEs to improve productivity by digitalizing their operations.

SMEs in Türkiye persistently face more difficulty accessing finance despite their significant contribution to the economy, the EBRD noted.

“In addition, their level of digital maturity lags that of their counterparts in the European Union and the OECD. The DTFF seeks to bridge this gap by providing financing for digital investments, fostering growth and innovation,” the development bank said in a statement.

The DTFF is being implemented in close cooperation with the Small and Medium Enterprises Development Organization of Türkiye (KOSGEB) and the Credit Guarantee Fund (KGF), with the latter providing first-loss risk cover underwritten by the Turkish Treasury.

SMEs joining the DTFF will be incentivized to use digital consultancy services to assess their digital maturity and develop a digital roadmap.

The EBRD is among Türkiye’s key investors, with more than 20 billion euros committed through 478 projects and trade finance limits since 2009, most of which are in the private sector.