Finnvera’s experience in using the counter-guarantee for micro-credit Finnvera Plc, Anneli Soppi The Role of Guarantee Funds in Microcredit, 5th Annual EMN Conference, Nice 9th of September 08

CIP guidelines Micro Credit Window Purpose of financing: investments in tangible or intangible, assets, working capital Terms: from 12 months up to 5 years Maximum amount: EUR 25,000 Borrowers: micro enterprises ( EU- definition ) EIF Guarantee Rate: up to 75% of the intermediary’s commitment Guarantee Cap: amount will be pre-set EU Requirements: additionality, promotion, visiblity, etc 4.6.2019

Finnvera and EIF´s Counter-guarantee 2 agreements 10/1999 – 6/2007 Counter-guarantees are due until 12/2016 Number of guarantees: 5000 Number of enterprises: 4500 600 million € Micro-enterprise guarantee scheme 45 million Guarantee portfolio: 255 million € Compensation By EIF: 6,5 million € (net) 4.6.2019

Counter guarantee of EIF Agreement Lender Bank Loan, promissory note Micro- Enterprise Borrower 1. 3. Risk assessment of the borrower 2. Guarantee to 75% 5. Inclusion notice, Reporting Application for compensations Waivers Answers to questions…. Agreement Finnvera Enterprise can make a contact direct with Finnvera or with a Bank EIF’s counter guarantee ? 4. 33,33% 4.6.2019 1

Any stumbling stones ? How to prove the ADDITIONALITY Reporting Increase on volumes, risk etc… or Maturity of Banking sector, the economical landscape in the country Etc… Reporting Follow up: Monitoring by EIF: random tests made by both EIF and Comission Counter guarantee: free of charge EIF can charge a penalty fee Pay attention to your own risk management: EIF agreement has a guarantee cap Sharing the collateral with bank and EIF – how to maintain lean organisation and agility on a working process Recovery - Waivers Payment transfer Transactions Receivables – bookkeeping, accountancy, rendering of accounts will keep your accountancy department busy 4.6.2019

Lessons learnt Keep it simple and flexible To comply the counter-guarantee with the national guarantee instruments, banking environment and -processes Our target group: SMEs starting the business, expanding, internationalisation and business transfers Rational reporting supported by your own information management requirements for a special data processing, programming State aid rules De Minimis, guarantee max. 1500.000 € Block exemptions 4.6.2019

Thank You! www.finnvera.fi Online Services online.finnvera.fi Telephone service +358 20 690 782 4.6.2019