Improving the EU policy environment for micro-enterprises and microfinance 4th European Microfinance Conference Berlin, 27 April 2007 Cindy Fökehrer Enterprise and Industry Directorate-General

Microfinance: DG ENTR activities Policy-making –“Microcredit for small businesses and business creation: bridging a market gap” Report, November 2003 –Microcredit European Conference, September 2004 –Expert group on the regulation of microcredit Financing –Ongoing financial instrument with special focus on promoting micro finance: microcredit window of SME Guarantee Facility

Financial instruments: MAP & CIP MAP Period: EU Budget: approx. € 500 million (in 2004 prices) CIP Period: EU Budget: € 1,129 billion (in current prices) I N D I C A T I V E : ETF-Start-ups (approx. € 200 m) - VC funds - high tech, early stages < 5 y  - Incubators  High Growth Innovative Companies Scheme - GIF ( € 554 m) - VC funds – GIF 1 ( € 255 m): Early stages  Expansion stages (funding € 200,000 - € 2.5 m)  - Co-investments in side-funds with business angels - GIF2 ( € 299 m)  SMEG (approx. € 300 m) - SME loans guarantee  - Microcredit guarantee  - Equity guarantees  - ICT loans guarantees  SMEG ( € 506 m) - SME loans guarantee  - Microcredit guarantee  - Equity and mezzanine guarantee  - SME loan securitisation risk-sharing scheme  JEV  Capacity Building (approx. € 1 m) - Seed Capital Action  Capacity Building ( € 69 m) - Seed Capital Action ( € 19 m)  Partnership with IFIs ( € 50 m) 

How do the Financial Instruments work in practice? Financial Intermediary Venture capital Fund SMEs Invests Lends Provide funds Guarantee Society Counter or Co-Guarantees European Commission budget EIB and Own Funds MFI

Financial instruments From the MAP to the CIP ( ): –EIF provides a guarantee (up to 75%) to microcredit providers, on behalf of the Commission –Provides also a lump sum grant of EUR 200 for each micro-loan to partially offset the transaction costs

Useful links Policies on access to finance –europa.eu.int/comm/enterprise/entrepreneurship/financing/ – ng/publications_documents.htm Financial instruments –europa.eu.int/comm/enterprise/entrepreneurship/financing/inst ruments.htm – New CIP programme : – ex_en.htm

Contact Cindy Fökehrer Enterprise & Industry Directorate-General Financing SMEs, entrepreneurs & innovators European Commission B-1049 Brussels Fax