EIB and Santander Sign €300M Deal for Europe’s Defence Supply Chain Firms

The Santander transaction forms part of a €3 billion pan-European financing programme that the EIB launched to address credit constraints facing EU businesses in security and defence supply chains.

Small and medium-sized businesses supplying Europe's security and defence industry could gain access to approximately €300 million in new financing through a guarantee agreement signed by the European Investment Bank and Santander in Madrid.

The deal is designed to help SMEs and mid-sized companies secure credit for investment, production expansion, technology development and the everyday costs of fulfilling new contracts, addressing funding pressures that can make it difficult for specialised suppliers to turn growing demand into sustainable growth.

Giving Smaller Suppliers Room to Grow

SMEs and mid-caps supply technologies, components and advanced solutions to major European security and defence companies, bringing specialist expertise, innovation and the flexibility to respond to changing industrial needs. Access to finance remains a barrier for many of these businesses, particularly when new orders require them to purchase materials, hire staff or expand facilities before receiving payment.

The EIB guarantee will support Santander in expanding the financing options available and improving their terms, with funding available for productive investments and working capital linked to increased activity. The agreement also supports the development of next-generation technologies with both military and civilian applications, connecting investment in security and defence with broader opportunities to improve productivity and industrial competitiveness.

For Spain and Europe, strengthening these suppliers means building a business base better equipped to innovate, withstand disruption and support major industrial projects, with benefits extending into strategic technologies used beyond the defence sector.

A Bigger European Financing Push

The Santander transaction forms part of a €3 billion pan-European financing programme that the EIB launched to address credit constraints facing EU businesses in security and defence supply chains. Delivered through banks, including other major European lenders, the programme provides a route for EIB support to reach companies through commercial financing relationships.

The agreement combines Santander's lending capacity with a European guarantee that helps manage financing risk, creating scope to support more businesses with investment and growth plans. Security and defence have become a strategic priority for the EIB Group, which quadrupled investment in the area to more than €4 billion in 2025, including €500 million in Spain.

The Group expects investment to exceed €5 billion in 2026, representing 5% of its total investments. Its support covers five areas: major critical infrastructure, European industrial capabilities, research and development of advanced technologies, venture capital investment in the sector, and SMEs supplying European defence contractors.

Public Backing Meets Private Lending

Gemma Feliciani, the EIB's Director of Financial Institutions, described the Santander agreement as an example of stronger partnerships with banks across the EU helping accelerate investment in security and defence. She said wider access to finance would give SMEs and mid-caps greater scope to grow, strengthen Europe's industrial base and support European strategic autonomy amid geopolitical uncertainty. Her comments underline the role that smaller suppliers play in the continent's capacity to develop and produce essential technologies.

Santander's Global Head of Commercial Banking, Borja Oyarzabal, said the bank wanted to support companies contributing to Europe's industrial development by combining its financing capacity with European risk-mitigation support. He highlighted smaller businesses as a source of innovation and technological development, linking improved credit access to stronger defence capabilities, industrial resilience and competitiveness.

Alexandra Borisova, Global Head of Private Debt Mobilization at Santander Corporate & Commercial Banking, stressed that meeting Europe's investment needs requires close cooperation between public and private capital, explaining that this approach can extend the impact of public resources and open financing to more companies with strong growth and innovation potential.