EIB Group supports microfinance in Spain

The European Investment Fund (EIF) has signed under COSME, a European Commission mandate, a loan guarantee agreement with Microbank providing partial first loss cover for new loans granted by MicroBank. In addition, the European Investment Bank (EIB) has also signed a loan agreement of EUR 100 million with MicroBank, the social bank within “la Caixa”. Both transactions are designed to support microenterprises and self-employed entrepreneurs in Spain with loan amounts of up to EUR 25 000.

The EIB loan, which will be matched by a further EUR 100 million of credit by MicroBank, will provide funding on attractive terms to self-employed young people and entrepreneurs’ start-ups in Spain. The funds are therefore expected to stimulate investment and boost economic growth and youth employment.

The COSME agreement between the EIF and MicroBank is the first one signed in Europe under the EU COSME programme and will provide partial first loss cover for a new portfolio of loans worth up to EUR 650 million over the next 3 years. This will help MicroBank to substantially increase its volume of lending to SMEs, including start-ups. Some 60 000 companies and entrepreneurs are expected to benefit from this EU support. MicroBank’s activity has been supported by EU guarantees since the start of its operations in 2007.

Speaking at the signing ceremony in Madrid, EIF Chief Executive, Pier Luigi Gilibert said: “I am delighted to be signing our first loan guarantee agreement in Europe under the COSME Programme. The EUR 650 million of loan finance for Spanish micro-entrepreneurs will help to create jobs and growth at a time when access to finance remains a key priority for the European economy. I am pleased that we can sign this agreement only months after the launch of COSME last year, which shows the positive demand for this initiative”.

During the signing ceremony, EIB Vice-President Román Escolano stressed that “this agreement represents a further step in the EIB Group’s continuous support for small and medium-sized businesses, which will play a key role in economic recovery”. He also emphasised that “by focusing on microenterprises and self-employed entrepreneurs, this operation will target a market segment that has been particularly affected by the restricted access to finance. This is why the involvement of the EIB group is especially necessary and valuable”.

Antonio Vila, the President of MicroBank, stated that “equal access to financing is an essential requirement for balanced economic development and has a decisive impact on the sustainable generation of wealth and jobs. With this agreement, we will continue supporting those entrepreneurs, self-employed people and small businesses that, for various reasons such as their small scale or lack of collateral, may find it difficult to obtain the necessary credit to carry out their projects.”

Daniel Calleja Crespo, Director General of the European Commission’s DG Enterprise and Industry commented: "We are pleased to be signing our first loan guarantee agreement under COSME, the first EU programme entirely dedicated to SMEs. The Commission is firmly committed to helping SMEs overcome their difficulties accessing credit. Thanks to today’s agreement with MicroBank, COSME guarantees will assist a large number of small Spanish businesses that would otherwise be unable to obtain finance due to the lack of collateral".

Background information

The European Investment Fund's (EIF) central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance. EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment.

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. For more information see: www.eib.org

MicroBank, the social bank created by “la Caixa” specialising in microfinance, is the only bank in Spain solely devoted to financing projects through microcredits. The bank offers loans of up to EUR 25 000 to the self-employed, entrepreneurs and microenterprises, as well as microcredits to individuals and families. The aim of these credits is to meet people’s needs to overcome their short-term difficulties and help in the development of families and individuals. Since it began its activities in 2007, MicroBank has granted 308 396 microcredits totalling EUR 1 796 million; and, according to data compiled in the “Report on the impact of microcredits” drawn up by the ESADE Business School, these have helped create and consolidate more than 134 000 jobs.

SMEs wishing to apply for finance under the COSME programme can directly contact MicroBank under the following website:http://www.microbanklacaixa.com

COSME is the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (SMEs) running from 2014 to 2020. COSME (mobilises loans and equity investments to SMEs in Europe. The COSME Loan Guarantee Facility (LGF) funds guarantees and counter-guarantees to financial institutions to help them provide more loans and lease finance mainly up to EUR 150,000 to SMEs. This facility also includes securitisation of SME debt finance portfolios. The COSME programme also invests through the COSME Equity Facility for Growth (EFG) in equity funds that provide risk capital to SMEs mainly in the expansion and growth stages. The COSME programme builds on the success of the Competitiveness and Innovation Framework Programme (2007-2013) which helped to mobilise more than EUR 18 billion of loans and EUR 3 billion of venture capital to over 350,000 SMEs in Europe.

Businesses can contact selected financial institutions in their country to get access to EU financing: www.access2finance.eu  

EIF:David Yormesor, d.yormesor@eif.org   +352 42 66 88 346

EIB: Matilde del Valle Serrano, m.delvalle@eib.org, +352 43 79 83 154

MicroBank: Communications and External Relations Department of “la Caixa” prensa@lacaixa.es +34 93 404 75 94