'The new abnormal' drives demand for innovation loans
In 2022, we provided NOK 1.3 billion in innovation loans to Norwegian businesses. Businesses are showing growing interest in our loan products Green Growth Loan and Internationalisation and Export Loan.
Genuine market failure
Higher interest rates mean that banks and other private investors can find good returns elsewhere than in innovative development projects. Uncertainty and changes in the capital markets lead investors to choose other investments they consider safer. Many companies have development projects that are vital to the green transition, business development and future exports. However, companies with a strong ability to service loans may lack sufficient collateral.
'We are seeing a trend where those who usually invest in innovative projects are less willing to take risks. Our role as a ‘green industrial bank’ is therefore more important than it has been for a long time,' says Håkon Haugli, our CEO.
Challenges of the 'new abnormal'
A key part of our role is to unlock private capital for businesses. Private investors are more willing to take risks when a business has already been offered loans and financial guarantees from us.
'Many say we have returned to the ‘new normal’ after the pandemic, but we are now in a ‘new abnormal’. We see an unmet need for capital in the market, which could hinder future industrial development, value creation and exports. Our role is to address this market failure so that Norwegian companies can seize the significant market opportunities,' says Haugli.
In 2022, 20 Norwegian companies, including Sayfr, received NOK 591 million in growth loans and green growth loans. Sayfr offers digital tools to transform safety culture, including in major shipping companies. In October last year, Sayfr received a growth loan to support internationalisation and exports.
'Our growth loan from Innovation Norway accelerated our product development, enabling us to launch a new product for measuring safety culture at the beginning of the year. The new product is designed to prevent accidents,' says Johan Rostoft, CEO of Sayfr.
Other key figures from our 2022 annual report
- We provided NOK 7.1 billion to businesses in 2022
- 68 per cent went to projects with a potentially positive environmental impact. This is an increase of seven percentage points compared with 2021 – which was also a record year for green financing
- Businesses that receive support from us grow more on average than comparable businesses without such support. Supported businesses achieved an average annual increase in revenue growth of 10.3 percentage points.
- 36.1 million guest nights at commercial accommodation establishments in Norway, an increase of 33 per cent from the previous year
- 88 per cent of the companies surveyed in the Customer Impact Survey believe that our contribution was crucial to delivering the project