EU clears Romania development bank support to boost SME finance

The European Commission has approved state aid measures for Romania’s national investment and development bank, Banca de Investiții și Dezvoltare, strengthening the country’s ability to channel public finance into SMEs, infrastructure and strategic investment.

The approval, announced on 25 June, gives Romania greater certainty over the role of its development bank as a financing vehicle at a time when EU member states are trying to improve access to capital for smaller companies and accelerate the use of European funds.

The bank is expected to support areas where commercial finance alone may be insufficient, including SME lending, regional development, infrastructure and green transition projects.

For working capital and development finance markets, the decision matters because national promotional banks are increasingly being used to close gaps between public policy objectives and private-sector lending capacity.

Romania has been seeking to strengthen its institutional capacity to absorb EU funding and support investment across the economy. A state-backed development bank can act as an intermediary for loans, guarantees and other financing instruments, helping smaller businesses and local authorities access capital more effectively.

The measure also reflects a broader European trend. Governments are relying more heavily on public finance institutions to support competitiveness, industrial policy and investment resilience while still operating within EU state aid controls.

For lenders, the development could create new partnership opportunities with Romania’s development bank, particularly in SME finance, guarantees and co-financing structures.