"Everywhere in the world, small and medium-sized businesses are riskier to finance than large businesses. Banks, of course, have an appetite to fund and take on higher risk, but to mitigate that risk to tolerable levels, they need to have a partner to cover some of that risk. There are various programs of the European Investment Bank (EIB), European Bank for Reconstruction and Development (EBRD), Bulgarian Development Bank (BDB), World Bank and other similar institutions that cover part of the risk that is above the bank's standards. At the moment, however, they are quite limited, and in my opinion, in order for this funding to be more large-scale, a greater commitment of the institutions for the creation of such programs is needed".
He stated this before ESGnews.bg Dimitar Dilov, Executive Director and Head of Risk Management at DSK Bank. According to him, the issue of financing small and medium-sized businesses is a serious problem.
“Typically, small and medium-sized enterprises (SMEs) have less capital and are less informed. However, there are a number of companies that are making investments in renewable sources or recycling. However, these are quite expensive at the moment and not so well known technologies. The risk that exists for the investor himself is great, as well as for the bank that finances it", explained Dimitar Dilov.
He is adamant that what needs to be worked on in the future is the creation of awareness and financing programs, with financing in mind to cover part of the risk for banks.
"Banks and companies are organizations that have a commercial interest in everything they do. And in my conversations in other countries, whenever it comes to renewable energy companies, in the end it comes to the question: Will I have a commercial benefit from this whole thing?", he further explained.
According to him, the topic of energy is developing both technologically and regulatoryly, as there are opportunities for financing. In terms of funding activities related to the circular economy, there are still not that many funding opportunities.
"Currently, if one has to look at the financing of a company that needs to implement something new, it is looked at like any other business - that is, one looks at what will be the financial effect of this thing that will be implemented. What can help to expand the financing opportunities for SMEs are the various programs", explained Dimitar Dilov.