The European Bank for Reconstruction and Development (EBRD), in collaboration with Banca Transilvania, is set to bolster the supply chain finance programme for retail chain in Romania, Profi Rom Food.
The EBRD has committed to assuming risk of up to €10m ($10.4m) in local currency to expand Profi's supply chain programme, benefiting its suppliers.
This initiative will increase Profi's existing programme, managed by Banca Transilvania, by the local-currency equivalent of €20m ($20.8m), with the EBRD covering half of the risk.
It marks the EBRD's inaugural supply chain finance transaction in Romania that aids a domestic value chain.
Profi runs 1,750 local convenience stores across Romania, under Super, Go, and Loco brands.
The EBRD's additional support is anticipated to provide more suppliers with affordable working capital solutions, promoting growth and stability within Profi's supply chain.
Profi works with up to 1,800 suppliers nationally, and the programme aims to incorporate more of them.
This project is in line with the EBRD's Country Strategy for Romania, focusing on the development of SMEs and the fortification of local supply chains.
Suppliers participating in the programme will also gain from the EBRD's Advice for Small Businesses (ASB) programme and the expertise of external consultants.
These resources will assist them in formulating effective green transition strategies, incorporating innovative solutions into their processes, and committing to the Science Based Targets initiative (SBTi).
Suppliers who commit to and publish SBTi targets will be eligible for cash incentives of up to €25,000 ($26,083) each from Horizon Europe, the European Union's funding programme for research and innovation.
EBRD Romania head Victoria Zinchuk said: "The EBRD remains committed to fostering innovation and sustainability within Romania's retail sector.
"By enhancing Profi's supply chain finance programme, we aim to empower SMEs, promote sustainable practices, and create significant economic impact in line with our broader strategy for the region."
"EBRD supports Romanian retailer Profi's supply chain finance programme" was originally created and published by Retail Insight Network, a GlobalData owned brand.