Doğan Investment Bank’s role in arranging European Fund for Southeast Europe financing for Tam Finans is a relatively small transaction in headline terms, with no value publicly disclosed, but it signals a potentially important shift in how international development capital reaches Türkiye’s smallest companies. The deal, announced on January 19, 2026, is EFSE’s first financing of a Turkish factoring institution and Tam Finans’s first international borrowing, creating a new channel through which foreign capital can support working-capital needs across local supply chains.
A New Route for International SME Finance
According to Doğan Investment Bank, the European Fund for Southeast Europe, or EFSE, provided the financing to support Tam Finans’s factoring activities and expand access to fast, technology-based funding for micro and small enterprises. Doğan acted as financial adviser.
The amount, currency, pricing and maturity were not disclosed in the announcement. Investors should therefore be cautious about treating the facility as transformational by itself. Its strategic importance lies instead in the structure and the precedent.
EFSE has previously worked in Türkiye through banks and leasing companies, but its move into factoring broadens the range of institutions eligible to intermediate development finance. EFSE’s March 2024 Türkiye fact sheet recorded nine active partner lending institutions and a committed country portfolio of €174.5 million. Its Turkish partners at that point included Akbank, DenizBank, Garanti BBVA, İşbank, QNB Finansbank, Yapı Kredi and three leasing companies.
Factoring institutions serve a different financing need. Rather than lending primarily against fixed assets, they advance cash against commercial receivables. This can be particularly useful for small suppliers that have delivered goods but must wait 30, 60 or 90 days for payment. The arrangement can convert an invoice into immediate liquidity, allowing the supplier to pay wages, purchase inputs and accept another order.
For international manufacturers, retailers and logistics operators entering Türkiye, the strength of that supplier-finance infrastructure can directly affect production continuity. A foreign-owned company may be well capitalized, yet remain exposed if local subcontractors cannot finance inventories or survive extended payment periods.
The deal is not foreign direct investment in the balance-of-payments sense because it is debt financing rather than an equity investment that gives the investor a lasting ownership interest. It nevertheless supports the operating environment in which FDI projects are implemented. That distinction matters, particularly when assessing whether headline capital flows are financing acquisitions, property purchases, new productive capacity or working capital.
Why Factoring Is Expanding
Türkiye’s high-inflation, high-interest-rate environment has made working-capital management unusually difficult. The International Monetary Fund said in its February 2026 Article IV assessment that annual inflation declined from 49.4 percent in September 2024 to 30.9 percent in December 2025. The IMF still estimated ex-ante real corporate lending rates at about 17 percent in December, despite the interest-rate reductions that began in late 2024.
The Central Bank of the Republic of Türkiye had briefly reversed that easing cycle in April 2025, raising its one-week repo rate to 46 percent after financial-market volatility. Even as inflation moderated later in the year, the cost of holding inventories and financing receivables remained substantial.
These conditions have increased demand for alternatives to conventional bank loans. Data from the Financial Institutions Association, or FKB, show that Türkiye’s factoring transaction volume rose 51.4 percent in 2025 to TRY 1.875 trillion. Factoring-sector assets increased 45 percent to TRY 458 billion. Across the five non-bank financial sectors represented by FKB, transaction volume reached TRY 3.878 trillion, equivalent to 6.5 percent of gross domestic product.
Momentum continued into 2026. FKB reported that factoring-sector assets reached TRY 525 billion in the first quarter, while receivables climbed to TRY 471 billion. Transaction volume was 52 percent higher than a year earlier.
Some of this expansion is nominal and reflects inflation, so the headline growth rates should not be read as equivalent real growth. Even so, the figures show that receivables finance has become a material part of Türkiye’s corporate funding system.
The Organisation for Economic Co-operation and Development reported that outstanding Turkish SME loans reached TRY 4.917 trillion in April 2025, an annual increase of 33.2 percent. Lira loans represented 80.7 percent of the stock. The OECD also cited the European Commission’s 2025 Survey on the Access to Finance of Enterprises, which found that bank-credit usage declined with company size: 55 percent for medium-sized enterprises, 46 percent for small businesses and 36 percent for microenterprises. High interest rates and insufficient collateral were the main obstacles reported by companies that did not borrow.
That gap is precisely where a factoring company focused on smaller invoices can operate. Factoring does not eliminate credit risk, and it can be expensive, but underwriting the underlying receivable may allow financing where a conventional balance-sheet loan is unavailable.
Tam Finans and the Economics of Small-Ticket Credit
Tam Finans began operating in 2012 with a focus on micro and small businesses. Fitch Ratings has previously described its customer base as including enterprises with limited credit histories, weak financial documentation or insufficient collateral. Fitch also highlighted the company’s use of proprietary scoring, automated data collection and monitoring systems to process large numbers of small transactions.
The model requires careful execution. Small-ticket finance carries high servicing costs relative to the amount advanced, while economic stress can weaken both the supplier that assigns the invoice and the customer responsible for paying it. Technology can lower origination costs, but it does not remove concentration, fraud or collection risk.
Tam Finans’s audited 2025 statements illustrate the pace of its expansion. Borrowings increased to TRY 13.81 billion from TRY 6.05 billion a year earlier. Securities issued rose to TRY 5.07 billion from TRY 969 million, while factoring-related liabilities reached TRY 6.70 billion. Factoring income increased to TRY 15.04 billion from TRY 8.17 billion.
The EFSE facility therefore adds an international source to a funding structure that had been expanding rapidly through domestic borrowing, receivables transfers and capital-market instruments. Depending on its undisclosed terms, it may also provide longer maturity or a different currency profile than domestic short-term instruments.
That introduces risk-management questions. If EFSE’s financing is denominated in euros while Tam Finans advances predominantly lira funding, the company needs an effective hedge or a contractual mechanism that places currency exposure elsewhere. Investors assessing the wider model should examine maturity matching, derivative documentation, collateral eligibility, provisioning and the quality of assigned receivables, not merely the availability of new foreign funding.
EFSE’s Development-Finance Model
EFSE was launched in 2005 as a public-private impact-investment vehicle supporting micro, small and medium-sized enterprises in Southeast Europe and the South Caucasus. It provides capital through local financial institutions rather than lending directly to most operating businesses.
The fund reported €1.7 billion in total assets and €5.3 billion in cumulative investments as of the second quarter of 2026. Austrian development bank OeEB, which signed a further €20 million investment in EFSE in November 2025, describes it as one of the world’s largest development-finance funds of its type. OeEB said its own stake had reached approximately €75 million.
EFSE’s funding base also connects the vehicle with multilateral capital. The International Finance Corporation announced a €50 million investment in EFSE in January 2024 to support enterprises across 15 markets, including Türkiye. IFC said 40 percent of that commitment was earmarked for women-owned micro, small and medium-sized businesses.
For EFSE, adding a factoring institution offers a way to reach enterprises that may not qualify for a conventional bank loan. For Tam Finans, the partnership can provide funding, international institutional scrutiny and potentially technical expertise. For Doğan Investment Bank, the advisory role demonstrates that Turkish investment banks can intermediate between global development funds and specialized domestic lenders.
Doğan itself has been expanding. Doğan Holding’s 2025 annual report said the bank’s assets increased 132 percent to TRY 9.5 billion, while cash loans rose 150 percent to TRY 6.5 billion. The report identified the Tam Finans transaction as both EFSE’s first financing of a factoring company in Türkiye and Tam Finans’s first international financing.
The Broader FDI and Supply-Chain Context
The transaction comes as Türkiye seeks to convert renewed international capital interest into productive investment. The Investment and Finance Office, citing Central Bank balance-of-payments data, reported that Türkiye attracted $13.1 billion in FDI during 2025, up 12.2 percent from 2024. Wholesale and retail trade accounted for 32 percent of inflows, manufacturing for 31 percent, and information and communication for 14 percent.
The same office said companies with international capital in Türkiye numbered 86,926 by mid-2025, compared with 5,600 in 2002. That large installed base creates demand for local suppliers in packaging, transport, maintenance, software, food processing, machinery and business services.
For foreign investors, supplier liquidity is both a financial and operational issue. A buyer’s standard payment policy may be manageable in a low-rate European market but disruptive for a Turkish microenterprise facing high lira funding costs. Factoring can bridge that mismatch, although the financing cost may ultimately be reflected in supplier prices.
Foreign companies should therefore evaluate payment terms during market-entry planning, map critical suppliers and determine whether receivables are legally assignable. Import-export transactions add further complexity through customs documentation, foreign-currency settlement, export-credit insurance and the distinction between domestic and international factoring.
Legal and tax compliance also matter. Türkiye’s factoring companies are supervised by the Banking Regulation and Supervision Agency, and receivables assignments must be supported by genuine commercial transactions and appropriate documentation. Foreign investors need controls covering invoice verification, related-party dealings, data protection, anti-money-laundering checks and the tax treatment of financing expenses.
What This Means for Foreign Investors
The EFSE transaction suggests that international development capital is moving deeper into Türkiye’s non-bank financial system. It does not remove the constraints created by inflation, interest rates or credit regulation, but it may widen the financing options available to smaller companies that form the operating backbone of foreign-invested projects.
An investor acting on this trend should begin with market-entry analysis that tests not only customer demand but also supplier funding capacity, payment practices and regional access to finance. Company incorporation and corporate structuring should establish clear treasury responsibilities, permitted financing arrangements and controls over receivables.
Investment-incentive work should be coordinated with the financing plan because subsidized investment loans, export support, regional incentives and development-finance facilities may carry separate eligibility and reporting conditions. Legal and tax compliance should cover factoring contracts, security packages, foreign-exchange exposure, transfer pricing and withholding obligations.
Government relations and regulatory liaison become relevant where a project depends on sector licences, incentive certificates or clarification from the Banking Regulation and Supervision Agency, the Central Bank, tax authorities or the Ministry of Trade. Import-export facilitation is necessary when the financed receivable crosses borders, while project management must connect funding milestones with procurement, factory setup and supplier onboarding.
For an FDI advisory firm such as fdiconsultancy.com, the practical role is to assemble these elements into an executable plan: selecting the right entry model, incorporating the local entity, identifying incentives, testing compliance, coordinating regulators and managing implementation. The broader lesson from the EFSE deal is that capital availability alone does not secure an investment. Foreign investors must ensure that financing reaches the local companies on which their Turkish operations will depend.