New Microfinance initiative: a valuable tool to stimulate entrepreneurship and create jobs

02 July 2009
by eub2 -- last modified 02 July 2009

EUROCHAMBRES warmly welcomes the 'Progress Microfinance Facility' presented by the European Commission today as a sound initiative to encourage and support entrepreneurship. Thanks to this new EUR 100 million fund, people who have lost or are at risk of losing their job and want to start their own micro-enterprise will be able to obtain loans up to EUR 25,000, and be assisted with mentoring, training, coaching and capacity building.

"Give a man a fish, you have fed him for today.  Teach a man to fish, and you have fed him for a lifetime.   This  is  the  ethos  that  will  lead  Europe  out  of  recession,"  said  Arnaldo  Abruzzini, Secretary  General  of  EUROCHAMBRES.    "It  is  encouraging  to  see  that  with  this  facility entrepreneurship  is  promoted  as  a  viable  and  rewarding  alternative  to  a  conventional employment contract.   This scheme  is not  just about  finding one new  job  for one unemployed
person.   Helping  someone  set  up  a  new  business  can  have  a  significant multiplier  effect  by generating additional jobs."

EUROCHAMBRES is also pleased that this measure is proposed on the basis of funds already available  in  the  framework  of  the  current EU Budget.   It  is  extremely  important  that  the EU's resources are used effectively to help businesses in this period of constrained liquidity. "The Chamber network is now eager to find out more details of how this Microfinance Facility will work  in practice, such as  the eligibility criteria  for the  loans and  the  interest rates applied.  This should be a priority item for the Swedish Presidency in the coming months and we will be looking
to  the Council  and Parliament  to ensure  that  this  crisis  response measure  is  swiftly  adopted," concluded Mr Abruzzini.

Microcredit - Also offered by Chambers
Facilitating  SMEs'  access  to  finance  with  microcredit  is  also  one  of  the  core  activities  of Chambers, who every year support the creation of over 700,000 new businesses.

For example, the Szechenyi Card - co-developed by the Hungarian Chamber - is a credit card which allows entrepreneurs or SMEs  to acquire small credits  (up  to EUR 100,000)  in an extremely short  time (2 weeks) and at  the lowest interest rate.   Four years after its launch,  the Szechenyi Card has reached 20% of the Hungarian SME sector, distributing EUR 1,6 billion to businesses and creating 18,000 jobs in 2005 and 2006 alone.

Chambers  hope  that  the  new  Microfinance  Facility  will  be  managed  consistently  with  the microcredit schemes already existing  in Member States, and offer  their  full cooperation  in  this respect.

EUROCHAMBRES – The Association of European Chambers of Commerce and Industry represents over 19 million enterprises in Europe – 96% of which are SMEs – through members in 45 countries and a European network of 2000 regional and local Chambers.

Eurochambres