EBRD Launches €25 Million Digital Transformation Loan Initiative for Türk Ekonomi Bankası

EBRD Launches €25 Million Digital Transformation Loan Initiative for Türk Ekonomi Bankası

(IN BRIEF) The European Bank for Reconstruction and Development (EBRD) has initiated a groundbreaking Digital Transformation Financing Facility (DTFF) with a €25 million loan to Türk Ekonomi Bankası (TEB) in Türkiye, marking its inaugural transaction. Aimed at boosting the digital transformation endeavors of small and medium-sized enterprises (SMEs), the loan will support Turkish manufacturing SMEs in upgrading their digital capabilities. Through collaboration with the Small and Medium Enterprises Development Organization of Türkiye (KOSGEB), the DTFF will incentivize SMEs to utilize digital consultancy services and develop digital roadmaps to enhance their business models with advanced technologies. This initiative underscores the EBRD’s strategic priority of promoting digital advancements and supporting SME productivity through modern technology, addressing persistent gaps in SME finance and digital maturity in Türkiye. The launch event in Ankara, attended by Turkish Minister of Industry and Technology Mehmet Fatih Kacır, EBRD Managing Director for Türkiye Arvid Tuerkner, and TEB’s Ali Gokhan Cengiz, marks a significant milestone in fostering Türkiye’s digital and SME agenda, aiming at sustainable economic progress and global competitiveness for SMEs.

(PRESS RELEASE) LONDON, 2-May-2024 — /EuropaWire/ — The European Bank for Reconstruction and Development (EBRD) is providing a €25 million loan to Türk Ekonomi Bankası (TEB) in Türkiye as the inaugural transaction under the Bank’s new Digital Transformation Financing Facility (DTFF) aimed at bolstering the digital transformation investments of small and medium-sized enterprises (SMEs).

The proceeds of the loan will finance the digital transformation investments of Turkish manufacturing SMEs. The DTFF programme is being implemented in close cooperation with the Small and Medium Enterprises Development Organization of Türkiye (KOSGEB).

SMEs joining the DTFF will be incentivised to use digital consultancy services to assess their digital maturity and develop a digital roadmap (an action plan to improve its business model through more use of advanced technologies). KOSGEB is supporting eligible manufacturing SMEs with digital-consultancy-fee rebates and interest-rate incentives for eligible projects, aiming to accelerate the country’s digital transformation.

Digital advancements remain one of the EBRD’s strategic priorities, with the Bank’s share of digital projects having risen by 30 per cent in 2023.  DTFF marks an important shift, directing the focus towards enhancing SME productivity through modern technology. Prior to this initiative, the EBRD has supported SMEs in various capacities, but this project is the first effort dedicated to enhancing SME productivity through digitalisation.

SMEs face a persistent gap in accessing finance in the country, despite their significant contribution to production and sales. In addition, their level of digital maturity lags behind that of their counterparts in the EU and OECD. The Digital Transformation Financing Facility seeks to bridge this gap by providing financing resources for digital investments and solutions, fostering growth and innovation. It is a unique pilot project, tailored for implementation across various regions, and includes initiatives to enhance digital skills.

The inaugural transaction was announced in Ankara by Turkish Minister of Industry and Technology Mehmet Fatih Kacır and EBRD Managing Director for Turkiye Arvid Tuerkner. Ali Gokhan Cengiz, SME Banking Assistant General Manager for TEB, was also present at the launch event for the facility.

Arvid Tuerkner, the EBRD Managing Director for Türkiye said: “Sustainable economic progress hinges on the inclusion of SMEs. The EBRD has long been a staunch supporter of SMEs in our countries of operation, including Türkiye. By launching our Digital Transformation Financing Facility through this first loan to TEB, we are proud to champion Türkiye’s digital and SME agenda, focusing on a critical goal: the digital transformation of Türkiye’s economy and giving SMEs a competitive digital edge.”

Ali Gökhan Cengiz, SME Banking Assistant General Manager for TEB, said: “Our bank’s priorities include contributing to the sustainable growth of the national economy and supporting our customers in their digital investments. In today’s digitalized industry, our SMEs must keep up with digital transformation and adapt to this process successfully in order to compete globally. As a bank, we contribute to the growth of our SMEs and help them stand out in competition, while supporting them in their digitalization processes.”

“We are pleased to offer support to our SME clients participating in the Digital Transformation Financing Program for their road maps and technology investments within the scope of their digital transformation. We have already signed numerous collaborations with the EBRD. With this new program, we are delighted to continue our existing cooperation with the EBRD in a way that will benefit the digital investments of our country.”

The EBRD is among the key investors in Türkiye, with €19.6 billion invested in 441 projects and trade facilitation lines since 2009, the majority of them in the private sector.

Media Contact:

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Email: Group-PressUnit@ebrd.com

SOURCE: EBRD