Noviti Finance, an alternative non-banking financier, will now provide business loans not only to small and medium-sized enterprises in Lithuania and Latvia but also in Poland.
Polish small businesses will have access to business loans of up to EUR 50,000 without pledging any assets, repayable over a period of up to three years. The decision to expand into Poland was taken in response to the significant and still unmet demand for financing from Polish small businesses.
“Since its inception, Noviti Finance has been focusing on small businesses, and Poland leads Europe in the number of companies in this segment. The smallest companies account for 97% of all Polish businesses, but their access to finance on favourable terms has so far been very limited,” says Linas Armalys, CEO of Noviti Finance.
Poland’s non-bank financiers are active in lending to individuals, but there is little choice of business loans in the country. Moreover, pricing is often very confusing. Many non-bank financiers in Poland apply various administrative, early repayment and other fees, which increase the final cost of the loan significantly.
As in the Baltic States, traditional banks in Poland tend to focus on larger companies, have limited scope to offer flexible terms and impose additional requirements in terms of assets under management, turnover or age.
Noviti Finance will offer the same loan conditions to its Polish customers as in Lithuania and Latvia. Businesses will be offered borrowing at a fixed interest rate for the entire contract period. This means that even if the European Central Bank raises base interest rates, Noviti Finance’s customers’ borrowing rates will not increase.
In the first year, it plans to finance more than 200 Polish companies and to provide EUR 3 million in loans. The company’s goal is to become the most recommended financier in the small business segment.
Noviti Finance has also assessed that Polish entrepreneurs have limited access to business support from the European Commission. Currently, no Polish non-bank financier works with European Investment Fund (EIF) microfinance programmes. In Poland, as in Lithuania and Latvia, Noviti Finance will provide loans under the EIF guarantee, which ensures that so-called micro-enterprises with up to 10 employees can access finance more easily and on better terms.
“Since 2016, Noviti Finance has been active in the market. During this period, the company has financed over 3,500 companies in the Baltic States, where Noviti Finance actively contributes to the promotion of small businesses. In Lithuania, Noviti Finance is an official partner of Invega and also lends to small businesses through the EIF’s InvestEU programme. During the COVID-19 pandemic, Noviti Finance actively implemented state support measures for businesses and was the second-largest financier in terms of “Loans to businesses most affected by COVID-19”.