The European Investment Fund (EIF) and financial institution Key Fund have signed a Social Entrepreneurship guarantee agreement aimed at supporting 200 social-enterprises in the UK under the EU Programme for Employment and Social Innovation (EaSI).
This new guarantee agreement allows Key Fund to provide a total of GBP 7.5 million (ca. €10 million) to 200 social entrepreneurs, many of whom face difficulties in accessing credit from traditional banking sources. Social entrepreneurs including those managing companies in deprived areas and/or providing products/services to disadvantaged communities will be able to benefit from loans at a reduced interest rate, without providing collateral under the EU supported programme.
Commissioner for Employment, Social Affairs, Skills and Labour Mobility, Marianne Thyssen, said: "Thanks to our EaSI programme, Key Fund will offer GBP 7.5 million in loans on preferential terms to 200 social enterprises in the UK. By facilitating access to finance to social enterprises based in underdeveloped areas of England and employing vulnerable people on the labour market, the European Commission shows once again its commitment to combat social exclusion."
EIF Chief Executive, Pier Luigi Gilibert said: This new EaSI deal in the UK demonstrates our commitment to supporting the social enterprise sector. Key Fund will provide finance solutions to social enterprises who often struggle to access finance from traditional lenders. This is our second deal under the EU Programme for Employment and Social Innovation in the UK which brings a total of EU 20 million to social and micro-enterprises in the country.”
Key Fund, Chief Executive, Matt Smith said: “We are delighted that we have secured this important support from EIF and European Commission that will allow us to deliver our mission and invest in even more community and social enterprises. Ultimately this will enable more impact in disadvantaged communities”.
The EaSI Guarantee scheme was launched in June 2015 and is funded by the European Commission and managed by the European Investment Fund. Social-enterprises wishing to apply for a loan under EaSI can directly contact Key Fund branches in the UK.
EIF will not provide direct financial support to enterprises but will implement the facility through local financial intermediaries, such as microfinance, social finance and guarantee institutions, as well as banks active across the EU-28 and additional countries that are participating in the EaSI programme. These intermediaries will deal with interested parties directly to provide support under the EaSI Guarantee.
About the Programme for Employment and Social Innovation
Under the EU Programme for Employment and Social Innovation (EaSI), the European Commission supports microfinance and social entrepreneurship finance with an overall envelope of EUR 193 million for the period 2014-2020. The aim is to increase access to microfinance, which includes microcredit i.e. loans of up to EUR 25,000, in particular for vulnerable persons and micro-enterprises. In addition, for the first time, the European Commission will also support social enterprises through loans of up to EUR 500,000. The microfinance and social entrepreneurship support will be first implemented through the EaSI Guarantee, which will enable financial intermediaries to reach out to (potential) micro-entrepreneurs that would not have been able to gain finance otherwise due to risk considerations. The European Commission has selected EIF to implement the EaSI Guarantee.
About the European Investment Fund
The European Investment Fund (EIF) is part of the European Investment Bank group. Its 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.
For further information on EU microfinance and social entrepreneurship support please refer to:
EU support to social entrepreneurship
Press contact:
EIF: David Yormesor, tel: +352 42 66 88 346, e-mail: d.yormesor@eif.org
EU Commission: Christian Wigand, tel: +32 2 296 22 53; Sara Soumillion, tel: +32 2 296 7094
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