Business loans: Everything you need to know

December 15, 2023

In September this year, we received the first European crowdfunding service provider license in Bulgaria1. This allows our investors to invest in loans on Afranga in a regulated environment.

With this come certain obligations for us in terms of the investment products which are offered on the crowdfunding platform. This article will give you an overview on the new financial assets.

Key takeaways:

  • Loans issued on Afranga will be regulated crowdfunding instruments called Business loans.
  • Each transaction represents a direct loan from the investor to the borrowing company.
  • There will be no changes to how accrued interest is calculated.
  • Each Business loan will be governed by a Key investment information sheet.

Introducing Business loans

Business loans are financial instruments that enable investors to invest in loans within a regulated environment. Each business loan is issued to a respective borrower (a company approved by Afranga to raise funds on the platform).

Each investment represents a direct loan from the investor to the borrower. Investors have the option to invest in an entire business loan or just a portion of it. When an investor commits funds to a business loan, they enter into a loan agreement with the borrower.

The minimum investment in a business loan is €10. Investors can hold their investment until maturity or choose to offer it for sale on the secondary market.

Accrued interest

Interest on Business loans accrues similarly to how it does on current loan claims. Each loan features a fixed maturity date and a predetermined interest rate. Repayments are made according to the loan's repayment schedule.

When a Borrower makes a repayment, these funds are automatically distributed among the investors' accounts proportionate to their investment.

Key information investment sheet

In the new investment setup on Afranga, investors will have access to an in-depth Key Information Investment Sheet (KIIS), which offers comprehensive details about the Borrower and the loan terms.

Each KIIS will present standardized information regarding the loan, including its currency, amount, repayment schedule, and details about any security provided. It will also outline any special terms associated with the loan, such as options for early repayment or extension. The document will include information about the borrower, such as their legal entity status, business sector, economic activities, key financials, and ownership structure.

The user experience will largely remain unchanged. Investors will be able to generate account statements, tax reports and other documents in their profile.

Transitioning to Business loans

Business loans will be introduced on Afranga in the 1st quarter of 2024. Until this launch, investors can continue trading loan claims as they currently do at This means that investors can still invest in new loan claims and sell them on the secondary market until the revamped goes live.

Upon the introduction of Business loans, we will discontinue offering loan claims on and we will start offering only Business loans on Afranga. The existing investments in loan claims will gradually be repaid over time. All active investments into loan claims will be repaid in accordance with their repayment schedules.

For instance, if an investor has invested in a loan claim on a month before we introduce Business loans, the investor will be able to keep the respective loan in his portfolio on until it is fully repaid.

We anticipate this transition period to be no longer than 4 months. After the transition period is over, will be phased out and only Business loans will be offered on

Learn more

If you want to learn more about the changes, read our dedicated article on the ECSP license and the changes it brings with it. If you have any specific questions regarding Business loans, feel free to submit your questions here. We'll address the most popular investor questions in a separate Investor Q&A: Regulatory changes article.

1 Decision 863 - DUKF/12.09.2023 of the Financial Supervision Commission.