• Pushing the Impact Frontier


The European Fund for Southeast Europe (EFSE) aims to foster economic development and prosperity in Southeast Europe and the EU Eastern Neighbourhood Region by investing in the success of micro and small enterprises (MSEs) as well as improved living conditions for private households.

That is why EFSE invests in the ability of local financial infrastructure to supply the resources entrepreneurs and families need to thrive. By enabling these groups’ access to responsible financing, EFSE strives for long-term, systemic impact.

The fund’s investment activities are complemented by the nonfinancial support of the EFSE Development Facility, which builds capacities, facilitates knowledge exchange, and nourishes an environment for entrepreneurs to grow.



Eradicating poverty in all its forms involves increasing access to basic resources and services, including financial services. EFSE contributes to meeting the basic financing needs of micro and small enterprises (MSEs) and low-income households.


Number of subloans facilitated to MSEs and households (cumulative)


Share of total rural and MSEs subloans disbursed below 20,000 EUR (current)

Percentage of Microfinance Institutions among active Partner Lending Institutions (current)25%


Ending all forms of hunger and malnutrition involves promoting agricultural productivity and improving the incomes of small-scale farmers. EFSE contributes to improving agricultural productivity and the livelihoods of small-scale food producers through secure and equal access to financial services.


Percentage of Partner Lending Institutions with dedicated rural & agri outstanding investments from EFSE (current)


Percentage of sub-loans disbursed to rural end-borrowers (current)

Number of Development Facility projects dedicated to advancing the agricultural sector (cumulative)40


Promoting sustained, inclusive and sustainable economic growth, full and productive employment, and decent work for all involves encouraging entrepreneurship and job creation. EFSE contributes to local economic growth and employment creation by enabling entrepreneurs to grow businesses, including through tailored financial services especially for young entrepreneurs and micro and small enterprises in rural areas.

Number of indirect jobs supported by MSEs receiving financing through Partner Lending Institutions* (cumulative)>1.9 MILLION
Number of Partner Lending Institutions supported with technical assistance in developing and strengthening processes and practices (cumulative)91
Number of Financial Institution staff and entrepreneurs trained on EFSE priority topics (cumulative)35,000


Building resilient infrastructure, promoting inclusive and sustainable industrialization, and fostering innovation involves upgrading existing industries and promoting new industries. EFSE contributes to upgrading small-scale industrial and other enterprises through improved access to financial services.

Total volume of sub-loans enabled for MSEs through EFSE financing (cumulative)EUR 5,860,8 MILLION
Number of MSEs receiving EFSE financing through a Partner Lending Institutions* (cumulative)283,000
Share of outstanding portfolio in local currency (current)71%


Reducing inequality within and among countries involves empowering people earning low incomes and promoting economic inclusion of all. EFSE contributes to sustaining and growing business income among marginalized entrepreneurs, such as women, youth, refugees, and rural populations.

Share of total MSEs and rural sub-loans disbursed in local currency (current)73%
Number of women-owned enterprises reached through MSEs finance* (cumulative since inception)48,000
Percentage of women benefitting from technical assistance projects (current)41%


Strengthening the means of implementation and revitalizing the global partnership for sustainable development involves mobilizing financial resources for developing countries. As a blended finance fund, EFSE contributes to bringing together public and private investors for sustainable development.

Total investor commitments (cumulative)EUR 946,3 MILLION
Percentage of private capital invested in the fund (current)21%
Total volume of financing provided for technical assistance (cumulative)EUR 36.2 MILLION

* Figure draws on Partner Lending Institutions reporting and estimations by EFSE.

Two hands of a woodworker carefully sand down a pair of wooden glasses frames
Fostering sustainable entrepreneurship


At its core, EFSE is dedicated to equipping small business owners and entrepreneurs with the financing and enabling environment they need to thrive. Ranging from manufacturing companies to small farms and craft shops, such enterprises often face limited access to financial services. By working with local financial intermediaries to better serve this target group and building the wider ecosystem for financial inclusion, EFSE contributes to empowering entrepreneurs to create or expand businesses – and in doing so, to contribute to local economic development. Read our stories to discover EFSE’s impact.

A comprehensive approach to impact

EFSE takes a comprehensive approach to economic development that involves not only improving the situation of individual MSEs and households. The fund endeavours to strengthen the systems that surround and enable these local entrepreneurs and families, thereby generating deep, long-term impact at scale. To achieve its mission, EFSE takes a three-pronged focus:

  •       Strengthening local financial markets
  •      Channelling tailored finance to MSEs and households
  •      Building a conducive ecosystem for entrepreneurship


For more details on how EFSE works towards its impact targets, refer to the Theory of Change, which summarizes the fund's impact logic and builds the foundation for its impact measurement and management system. 

Holistic Impact Management

The “what” and “how” of achieving impact – in other words, the fund’s impact objectives and approach through dedicated financing and technical assistance – are defined in EFSE’s strategy documents.

Prior to any investment, the fund undertakes a thorough screening of potential investees. Only if an institution meets the fund’s requirements for financial return, development impact, and sound environmental and social (E&S) management will the investment proceed.

Once invested, EFSE combines mitigating and reducing negative impact and enhancing positive impact throughout the investment cycle:

  • EFSE applies a range of instruments to enhance its positive impact,  including specific eligibility criteria to ensure that resources are actually on-lent for the intended purpose; portfolio targets, such as increasing the proportion of local currency       lending; and the deployment of technical assistance to build capacity as and where needed. The fund combines a range of data sources to track progress against its key performance indicators, including reporting by the investees and periodic end-borrower studies. This provides EFSE with a feedback loop of insights and learnings that enable the fund to continuously fine-tune its strategy.
  • E&S considerations are incorporated into all aspects of decision making and operations. EFSE maintains, implements and continuously improves a formal Environmental and Social Management System (ESMS), including policies, procedures and practical tools that support the E&S policy’s implementation throughout the investment cycle.

EFSE endeavours to align its holistic impact management with international standards and good practices, including the Operating Principles for Impact Management, the IFC Performance Standards, and core responsible finance frameworks.

Impact Principle Verified

Finance in Motion, EFSE advisor, is a signatory of the Operating Principles for Impact Management (Impact Principles), aligning also EFSE’s impact management system with these recognized industry practices. 

Along with an annual disclosure statement, which provides details on the practices applied, the advisor is committed to periodic independent verifications. The first verification, conducted in 2021 by the specialized consulting firm BlueMark, affirmed strong alignment with the Operating Principles for Impact Management.



In pursuing its sustainable investment objective, EFSE places a priority on effectively managing potential environmental and social (E&S) risks associated with the Fund’s investments. In addition, the fund integrates environmental, social and governance (ESG) considerations into decision-making and investee engagement. In line with this sustainable investment objective, the fund falls within the scope of Article 9 of the Regulation (EU) 2019/2088 on the Sustainable Finance Disclosure Regulation (SFDR).

For sustainability-related disclosures in line with the requirements of the SFDR and more information on the fund’s approach to impact and sustainability, please refer to:

Get in touch

Interested in learning more about how the fund works, or seeking partnership opportunities? Contact an EFSE representative today.


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