After a prolonged period of caution, the corporate lending market in Latvia is showing a convincing recovery in 2025, driven by falling interest rates and entrepreneurs’ growing willingness to invest in development. The corporate lending market has become one of the fastest growing in the euro area, and non-bank financial service providers such as Cityfinances play a decisive role in reducing the financing gap in the SME segment.
Data included in the Bank of Latvia’s “Financial Accessibility Review 2025” indicate a significant turning point in lending. According to the latest financial report, in the first eight months of 2025 the outstanding volume of loans issued to non-financial corporations increased by 18.6%, significantly outpacing GDP growth. Several factors form the basis of this expansion. A major role is unquestionably played by the change in monetary policy in the euro area – the decline in EURIBOR rates has created more favorable borrowing conditions.
Favorable conditions have encouraged faster borrowing, and the Finance Industry Association has found that corporate lending growth in Latvia has been among the fastest in the euro area.
Although most corporate funding is provided by commercial banks, lenders to businesses such as Cityfinances are becoming an increasingly important partner, especially in serving those SMEs that need fast, flexible and smaller-scale business loans.
“2025 marks a transition from caution to growth. However, many small businesses still have limited access to bank financing due to complex procedures or insufficient collateral. In addition, in a dynamic business environment companies need money immediately, without wasting time on bureaucratic formalities or trips to the bank. Since, in the case of a positive assessment, Cityfinances transfers money to the company’s account on the same day the application is submitted, entrepreneurs are happy to use this opportunity to obtain funds,” comments Cityfinances CEO Ivars Vītols.
With moderate inflation and stable labor market indicators, lending growth will continue in 2026 as well.
“We expect that companies will increasingly seek targeted financing that supports modernization, digitalization and sustainable projects. Cityfinances is ready to become the main support instrument precisely in this segment, offering tailored solutions that strengthen companies’ competitiveness at regional and global level,” adds I. Vītols.
About Cityfinances
Cityfinances is a Latvian-owned company specializing in lending to businesses. Over 10 years of operation, Cityfinances has issued business loans totaling at least 300 million euros, helping more than 3000 companies from a wide range of sectors to implement development projects. A key advantage of Cityfinances’ business model is the rapid disbursement of financing. Within 5 minutes after submitting a request, the company receives a response, and if the assessment is positive, the loan is transferred on the same day.
More information: www.cityfinances.lv
This is paid information.
Originally published at https://inc-baltics.com/uznemumu-kreditesana-latvija-piedzivo-vienu-no-straujakajiem-kapumiem-eirozona/
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