The European Commission welcomed today the signing of the SME Initiative with Spain, a ground-breaking agreement to unlock more than €3.2 billion of additional lending for companies with fewer than 250 employees (SMEs). In practice, under the new SME Initiative signed with Spain, regions in the country will reallocate part of their EU funding from European Structural and Investment Funds, i.e. €800 million. Rather than being given as a traditional grant, this pooled money will be channelled through the SME Initiative and used as a guarantee to take first risk in projects. This results in a higher leverage than if the funds were given as traditional grants and will make possible at least an additional €3.2 billion and - depending on market take-up - up to €5.3 billion for Spanish SMEs. (RAPID, IP/15/3682, 26.1.2015)