Financing SMEs and Entrepreneurs 2026: Slovenia
Table of contents
Small and medium-sized enterprises (SMEs) accounted for 99.6% of all companies in Slovenia in 2024. As the backbone of the national economy, they generated 61.3% of total turnover and employed 65.7% of the workforce.
Following a period of strong economic growth and intensified borrowing, financing via loans slowed considerably. The outstanding stock of SME loans declined by 7.2% over 2023 and 2024, driven by reduced demand and a drop in new loan issuance.
By the end of 2022, financing conditions for the non-banking sector had deteriorated significantly. Interest rates for SMEs rose from 2.3% in 2021 to 5.2% in 2024, although they began to decline in the second half of 2024 as monetary policy eased, falling to 4,0% in 2025.
According to the Bank of Slovenia’s annual survey on access to finance, firms reported improved access for the second consecutive year in 2024, though conditions remained less favourable than in 2021. While financing continued to pose challenges for the business sector amid the ongoing economic uncertainty and limited availability of government incentives, firms observed some improvements in availability of finance, alongside declining inflation and financing costs. Nevertheless, many remained cautious, with fewer firms applying for external funding.
The government policy response has been primarily through the SID Bank and the Slovene Enterprise Fund. The SID bank, the national development bank, acts as a:
1. Manager of fund of funds structure of the European cohesion funds including the ERDF under the2014-2020 and 2021-2027 financial perspectives. These funds are deployed ether directly or indirectly via financial intermediaries, such as commercial banks or public financial institutions including the Slovene Enterprise Fund));
2. Ccomplementary financial institution to commercial banks through own loan facilities as well as guarantee lines to support the Slovene SMEs domestically and abroad; and
3. Developer of equity financing programmes in Slovenia.
Additionally, the Slovene Enterprise Fund, acts as a public fund and a financial institution of Ministry of Economy, Tourism and Sports, offering favourable financial resources; grants (for innovative startups, for digital transformation of SMEs, etc.); seed capital; guarantees for bank loans with subsidised interest rates; and microloans.
In addition to bank lending from commercial banks, and the SID Bank, the government of the Republic of Slovenia in co-operation with state owned financial institutions also implemented a range of measures to fill the gaps in SME access to finance and complement other financial measures. These policies include:
Slovene enterprise fund offers blended finance for innovative startups (EUR 2.1 million per year for 401 innovative startups). The government provide grants blended with mentoring and training.
Slovene enterprise fund offers also blended finance for seed capital in the form of convertible loans and equity capital blended with mentoring and training.
Slovene enterprise fund supported also two venture capital funds (Tivol ventures and Silicon Gardens). They will offer EUR 50 million of venture capital to startups and scaleups.
Slovene enterprise fund is also part of CEFOF programme (Central European Fund of Funds).
SID bank established with EIF the SEGIP fund (EUR 100 million) that was expanded, and the total value is EUR 220 million.
SID bank is one of the key investors in the Three Seas Initiative Investment Fund (EUR 23 million committed by SID).
In addition, the Slovene government adopted the Slovene Startup Strategy on 5 March 2026.
Source: See Table 5.
The growth of the Slovenian economy in 2024 was relatively modest at 1.6%, 0.5 percentage points lower than growth in 2023, however showing some favourable changes in its structure. As inflation declined, real net wage bill increased, supporting a renewed growth in household consumption (1.6%). The growth in government consumption was higher at 8.5%, driven in part by higher government sector employment and increased spending on post-flood reconstruction.
Favourable domestic conditions contributed to stronger value-added growth in private services. However, 2024 proved challenging for firms in terms of investment. Heightened international uncertainty, high energy costs, and a reduction in government investment following the conclusion of the previous EU financial framework, led to a sharp downturn in the investment cycle. Overall investment fell by 3.7% year-on-year. Lower government investment particularly affected the construction sector, where value added declined by 1.4%, following strong growth in 2023. In contrast, manufacturing saw a 3.1% increase in value added, supported by a rebound in merchandise exports. Strengthened domestic demand and inventory restocking also contributed to a notable recovery in imports.
Despite signs of a slowdown, the labour market remained tight in 2024. Employment growth stalled and the unemployment rate remained historically low at 3.7%. Due to persistent labour shortages, firms continued to hire foreign workers, who accounted for 15.7% of total employment. While nominal wage growth moderated, it remained above the long-term average, reflecting both past inflation and ongoing labour market tightness.
Inflation declined sharply, from 7.2% in 2023 to 2.0% in 2024. This was largely the result of past monetary policy decisions, a fall in wholesale energy prices, easing global supply chain pressures, and cyclical slowdown in certain sectors of the domestic economy.
The banking sector experienced mostly favourable business trends, generating above-average net interest income in 2024 compared to previous years. Lending activity strengthened overall, although trends varied across segments. Lending to non-financial corporations was very weak, while household lending, particularly consumer loans, saw a notable increase. The main driver of rising loan demand was the decline in the general level of interest rates in 2024.
Small and medium-sized enterprises represented 99.6% of all business entities in 2024, of which 87.1% were micro enterprises. They generated 61.3% of the total turnover and employed 65.7% of all employees.
Source: Statistical Office of the Republic of Slovenia
Following a period of intensified borrowing during times of strong economic growth, firms recorded a slowdown in financing via loans. Over 2023 and 2024, the outstanding stock of SME loans contracted by approximately 7%, reflecting a marked decline in demand. In 2023, the primary drivers of reduced loan demand were high interest rates and lower investment financing needs. By 2024, however, the decline was largely influenced by the improved availability of internal resources, supported by rising corporate profits. Additionally, growing competition from both other banks and non-bank lenders, particularly in an environment of falling interest rates, further contributed to the reduced reliance on domestic bank loans. In contrast to the decline in domestic bank lending, borrowing from foreign parent companies and from other non-financial corporations in Slovenia continued to grow.
The decline in bank lending over 2023 and 2024 was broad-based, across activities and company sizes as well as loan purpose. In terms of the size of the firms financing themselves at banks, the decline in outstanding loans was evident at firms of all corporate sizes, with SMEs experiencing a slightly larger decrease (–7.2%) compared to large firms (–6.6%). As a result, the share of SME loans in total business lending remained just above 50%, consistent with the average of the past eight years. After a steady decline since 2012, the share of short-term SME loans stabilised at just below 15% over the last three years.
The decline in bank lending in 2024 was primarily driven by an increase in loan repayments. While new business lending rose, this growth was limited to large enterprises. New loans to SMEs, on the other hand, declined for the second consecutive year, in line with weaker demand.
By the end of 2022, financing conditions for the non-banking sector had worsened significantly compared to previous years amid the strong inflationary pressures. Interest rates for SMEs rose from 2.3% in 2021 to 5.2% in 2024, though they already began to decline in the second half of 2024 as monetary policy eased. While large enterprises enjoyed overall better credit terms during this period, interest rates for large firms stood just below 5% in 2024. The interest rate spread continued to decrease, showing that credit conditions for SMEs and large companies are converging.
According to the Bank of Slovenia’s annual survey on access to finance, firms reported improved access for the second consecutive year in 2024. Key business constraints such as production costs, inflation, and the availability of skilled labour eased in 2024, especially for large firms. Access to finance was generally seen as one of the least significant obstacles. However, among SMEs, the share of firms citing financing as a major constraint increased.
Firms reported a net increase in the need for nearly all sources of finance in 2024. At the same time, they experienced improved net access to most sources of finance, which led to a considerable narrowing of the financing gap in 2024.
Firms continued to rely more heavily on internal sources of financing in 2024, which reduced the demand for external funding. For the second consecutive year, the number of firms that did not apply for external financing increased, with the primary reason being the availability of sufficient own funds. According to firms, business-specific factors had the most positive influence on access to external financing, while the general economic situation and the availability of government financial incentives had the most negative impact. Amid the falling interest rate and declining financing costs, firms reported an improvement in financing conditions, which nevertheless remained worse than in 2021. Despite the improvement, SMEs remained worse off than large firms. Regardless of these challenges, firms were largely successful in securing the financing they sought across all sources, with rejection rates remaining negligible.
Looking ahead, the vast majority of firms had planned to invest during the 2025–2027 period, primarily in equipment and machinery, real estate, and business expansion. These investments were expected to be financed mainly through internal funds and bank loans.
Besides bank lending, the government of the Republic of Slovenia offered through its implementing institutions other sources of finance.
The SID bank, the national development bank, acts as a (1) manager of fund of funds structure of the European cohesion funds (ERDF) for the recently financial perspectives, which last from 2014-2020 and 2021-2027 (directly or indirectly via financial intermediaries as commercial banks or state financial bodies (i.e., the Slovene Enterprise Fund)), (2) complementary financial institution to commercial banks through own loan facilities as well as guarantee lines to support the Slovene SMEs domestically and abroad and (3) developer of equity financing programmes in Slovenia. Additionally, the Slovene Enterprise Fund, acts as a public fund and a financial institution of Ministry of Economy, Tourism and Sport, offering favourable financial resources including guarantees for bank loans with the interest rate subsidy, (micro)loans and grants (for innovative startups, for digital transformation of SMEs, etc.).
In 2025 Slovene Enterprise Fund tendered favourable financial resources for micro, small and medium-sized companies in the form of:
guarantees for bank loans with an interest rate subsidy, facilitating faster and easier access to more favourable bank financing under reduced collateral requirements.
micro-loans for smaller investments and working capital, aimed at improving business operations and liquidity loans to mitigate the impacts of the energy crisis on the economy; and
grants for the launch of innovative start-up companies and for the wood-processing industry, aimed at supporting product development, market entry and strengthening competitiveness.
The Slovenian Enterprise Fund approved EUR 176.05 million in financial incentives for SMEs in 2025 and supported 4,154 projects. The total volume of supported investments amounted to EUR 238.35 million.
In 2025, SEF has also run a streamlined voucher scheme, serving as a simplified support mechanism co-financing specialised services provided by external experts or institutions, enabling SMEs to strengthen capacities, improve processes and enhance competitiveness. The scheme included six different vouchers, covering legal/corporate status transformation, R&D and business design in the wood-processing sector, ownership transfer, certification-related services, intellectual property protection, and participation in economic delegations abroad.
Slovene enterprise fund (SEF) has been focusing since 2006 on supporting young innovative companies through start-up grants. On 2023 and 2024, however, the Slovene Enterprise Fund had no active risk capital programmes. In 2025, a public tender was launched, the Slovene Technology Fund in the amount of EUR 10 million. The SEF also have active funds under Central European Fund of Funds (CEFoF).
Central Europe Fund of Funds: SEF is involved in the Central Europe Fund of Funds (CEFoF), designed by the EIF in close co-operation with governments and national agencies of Slovenia, Austria, Czech Republic, Slovakia and Hungary. Its aim is increasing equity investments in SMEs in the Central European region. The fund gives access to venture capital for SMEs and mid-cap companies (companies with up to 500 employees) in the phase of rapid growth, through supported venture and private capital funds. Investment commitments were made to 9 private and venture capital funds. Size of the fund of funds (CEFoF) is EUR 81 million, of which EUR 8 million is the contribution by the Slovene Enterprise Fund. With additional private capital invested through venture capital companies within the framework of CEFoF, the fund sizes amount to EUR 674 million. At the beginning of 2022, the first investment in the Slovenian company Marles Hiše d.o.o. was completed by Invera PE Fund in the amount of EUR 9.01 million.
The aggregate size of the nine funds represents EUR 694.2 million, with a final multiplier of 8.6 times in terms of overall resources mobilised as supported by commitments from the CEFoF.
Slovene Technology Fund 2025: Being very aware of the challenges that innovative companies face in obtaining financing for expansion into international markets, the Slovene enterprise fund (SEF) planned to take a step forward in supporting companies in the growth phase. This phase is extremely risky, but at the same time requires high investments, which are crucial for the survival and growth of young companies. In order to fill this gap in the market, the SEF created the Slovenian Technology Fund (STS 2025).
The Slovene Enterprise Fund (SPS) had a public tender for the Slovenian Technology Fund in 2025, offering EUR 10 million in funds for investment in two seed/venture capital funds. Two venture capital management companies were selected, which managed to raise the most private investments or investment commitments.
Funds:
Silicon Gardens Fund III, special investment fund: Size of the fund is EUR 32.51 million, commitment by the Slovene Enterprise Fund EUR 5 million. The fund's investment strategy is not limited to specific industries or sectors, but priority is given to investments in the digital technology industry. Geographically, SGF III focuses on, but is not limited to, investments in companies whose founders come from Slovenia, Croatia, Serbia, and other countries in the Adriatic region. The fund currently has 15 investments.
Tivoli Ventures, alternative investment fund: The fund focused on investing in pre-seed, seed, and Series A stages of fast-growing technology companies. It operates with a primary focus on Slovenia and the wider region. The Fund is still not active (not yet in the investment phase). Commitment by the Slovene Enterprise Fund is EUR 5 million, soft commitments from private investors, mainly institutional investors like pension funds are EUR 12.5 million. The fund is in the process of obtaining approval for Special Investment Fund status from the ATVP.
Throughout its years of operation, as in 2025, the Fund has approved the most funds in the form of guarantee lines (43%), followed by loans (41%), which have gained importance in recent years. Other lines have a smaller percentage of approved funds.
At the end of 2025, net loans of SID Banka totaled EUR 1,65 billion (end of 2023: EUR 1.67 and at the end of 2024 EUR 1,51 billion), with a structural increase in the share of direct financing.
Funding is implemented by established instruments, which are then adapted to current needs. It is based on long-term earmarked loans to commercial banks, direct loans to enterprises with or without state aid status (especially under financial engineering instruments), export credits, project finance, debt buy-backs, debt incursions and other forms of risk-taking.
The volume of loans to non-bank customers decreased by 2.6% in 2025 and amounted to EUR 1.3 billion at the end of the year. At the end of 2025, the balance of the loan portfolio amounted to EUR 1 406 815 thousand (December 31, 2024: EUR 1 512 225 thousand). Net loans decreased in both the corporate and bank financing areas. SID Bank directly placed EUR 249 974 thousand in loans to the non-banking sector in 2025, which was significantly above the original plan In terms of main purposes, the largest share in 2025, 87.3% of the value of all new loans, was for the development of a competitive economy, 9.4% for regional development, and 3.3% for the development of a knowledge society and innovative entrepreneurship.
In terms of the value of new loans, the largest borrowers were firms in manufacturing (43.0% of the total), followed by wholesale and retail trade (12.9%), transportation and storage (10.3%), accommodation and food service activities (7.6%), activities related to telecommunications, computer programming, consultancy, computer infrastructure and other information services (7.3%), real estate activities (3.7%), construction (3.6%), professional, scientific and technical activities (3.2%) and other service activities (8.4%).
The total net amount of loans granted from all financial engineering programmes amounted to EUR 519 943 thousand, which is 22.8%more than at the end of 2024. In 2025, 79 contracts were signed worth EUR 147 230 thousand. These measures ensure a high multiplier and also revolving effect of state budget funds. The multiplier effect (increase in the total volume of financing in relation to the invested state funds and also the reuse of returned funds) varies by loan fund and at the end of 2025 ranged between 3.5 and 8.3.
In 2026, SID Bank in co-operation with the Ministry of economy, tourism and sport will establish two new loan funds within the framework of its financial engineering work. The first fund is for financing all kinds of investment with the aim of promoting investment and encouraging the competitiveness of the economy, while the second fund is aimed at anti-crisis financing, and will serve as a safety mechanism to protect the economy from major shocks that hit firms outside their ability to influence, while during economic good times the focus will be on development financing. A total of EUR 1 billion in products from the two loan funds will be available, and they will therefore represent the foundation of SID Bank’s financing of the Slovenian economy over the medium term.
SID bank has established programmes for equity financing which includes supporting innovative and high-tech start-ups and scale-ups in Slovenia. It offers seed capital and convertible loans to support early-stage development, product commercialisation, and scaling of technology-driven businesses.
Within the framework of equity financing, SID Bank has provided funding through the SEGIP programme and a separate investment in the Three Seas Initiative Fund.
SEGIP: In 2017, SID Bank, together with the EIF, established the Slovenian Capital Growth Investment Programme (SEGIP) in the total amount of EUR 100 million (EUR 50 million SID Bank and EUR 50 million EIF), and among the first domestic recipients of funding were fund managers ALFI PE d.o.o. and Generali Investments d.o.o (later Generali Investments sold their PE fund to ALFI PE). The SEGIP programme was subsequently expanded twice:
in 2021 by additional EUR 22 million (for the establishment of a technology transfer fund within the CEETT platform in co-operation with HBOR; the established fund is managed by Vesna Venture Capital), and
in 2022 by additional EUR 98 million (EUR 40 million for an early-stage VC fund – managed by Pan Adria Ventures and EUR 50 million for two PE succession funds – managed by Prva Capital Partners and MS PE).
The total volume of SEGIP after the expansions amounts to EUR 220 million, of which EUR 178 million is currently allocated.
Source: See Table 5
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← 1. Since 2024, due to higher grant amounts per startup, 30 innovative startups have been supported annually.