- October 1, 2017
- Posted by: Benjamin
- Category: Microcredit
The microcredit guarantee fund
Loans granted by microcredit providers are not accompanied by real guarantees. This can be a risk for a borrower. The risk is even greater if you consider that professionals, craftsmen and companies who have access to this formula have small business activities and a small business volume or are people living in poverty.
To protect the operators authorized to grant microcredit loans, the Guarantee Fund for microcredit was created. The Fund was established in 2014 with a Decree of the Ministry of Economic Development. By a second decree in 2015, the procedure for accessing the fund was simplified and companies were given the opportunity to apply for a guarantee booking directly online.
It is a public fund that guarantees financing operations. Professionals and companies under 5 years of age, with fewer than 5 employees and operating in the areas identified by the Ministry may apply for fund assistance. In order to be able to obtain the guarantee of the Fund, it is also necessary to observe precise budget values (assets not exceeding 300,000 euros, revenues less than 200,000 euros and total indebtedness within 100,000 euros).
Business activities that meet these requirements may apply for a public fund guarantee, provided that the loan is used for one of the purposes indicated by the Ministry of Economic Development.
The permitted purposes are:
- the purchase of instrumental goods and services for the exercise of business activity;
- remuneration of new employees or workers’ members;
- the frequency of training courses.
In order to claim the protection of the Fund, it is necessary to book the guarantee online, confirm the reservation within 5 days proving that you have found an authorized lender willing to grant the loan and then submit the application for the guarantee within 60 days. The application must be one of the authorized persons: a bank, a financial intermediary or a microcredit operator.
Microcredit: National and Regional Funding
In addition to the financing activities carried out by the ENM and some banking institutions active at national level, there are opportunities to obtain loans at regional level.
Each region elaborates calls and initiatives for microcredit valid in a specific territorial area. Actions are designed to support the birth and development of new economic activities or to support running and running costs. As always, to be funded are people and businesses that are not eligible for bank loans.
Due to its characteristics, microcredit has common points both with honor credit and private loans.