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Access to finance


Bills, glasses and calculator with receipt

Increasing the supply of microcredit (loans of up to €25 000) is important for encouraging new businesses, stimulating economic growth (in line with the Europe 2020 strategy) and opening doors to people who would not otherwise have such opportunities (EU policy on social inclusion).

Traditionally, the term 'microcredit' is most commonly used in relation to developing countries, where it involves much smaller amounts and is focused on eradicating poverty.

Entrepreneurs often find it difficult to borrow small amounts, because many banks see microcredit as a high-risk, low-return activity, and their handling costs are high in relation to the lent amount. Many EU Member States have specialisted microfinance institutions to overcome these problems.

Commission initiatives

The Commission seeks to help EU Member States and regions improve their provision of microcredit by policy development and by spreading good practices.

  • Gaining scale in Microcredit - Can banks make it happen? pdf - 859 KB [859 KB] (2010): A report on two workshops organised by the European Commission’s Directorate-General for Enterprise and Industry in November 2008 and March 2009 on the role of the banks for microcredit in Europe.
  • The European initiative to develop microcredit in support of growth and employment (2007) pdf български (bg) czech (cs) dansk (da) Deutsch (de) eesti (et) ελληνικά (el) español (es) Français (fr) Gaeilge (ga) hrvatski (hr) italiano (it) latviešu (lv) lietuvių (lt) magyar (hu) Malti (mt) Nederlands (nl) polski (pl) português (pt) română (ro) slovenčina (sk) slovenščina (sl) suomi (fi) svenska (sv) [366 KB] seeks to improve the availability of microloans for small businesses and for socially excluded people wanting to become self-employed. It operates on four fronts:
    • improving legal and institutional conditions for businesses in EU countries - relaxing interest rate caps, providing access to borrower databases, tax incentives, adapting banking regulation and supervision, applying the single market rules,
    • promoting a positive view of entrepreneurship - improving conditions for self-employed people and very small businesses, encouraging people to become self-employed, offering additional business development services,
    • spreading best practices - training, technical expertise and coordination, and a certification scheme / code of conduct for microfinance institutions,
    • top-up financial capital for micro-credit institutions - with a focus on new and non-bank institutions.
  • Regulation of microcredit (2007): an overview of EU and national rules, plus and recommendations for possible improvements.
  • Microcredit European Conference (2004): organised jointly with the European microfinance network (EMN), the microfinance centre for Central and Eastern Europe and the CIS (MFC) and the network of European financial institutions (NEFI) in Brussels in September 2004. The objective was to spread good practices in providing access to microfinance for small enterprises and also come up with action points for the future.
  • Microcredit for European small businesses (2004): survey of the availability of microcredit in Europe (Commission staff working paper).
  • Microcredit for small businesses and businesses creation - bridging a market gap (2003): an overview by national and financial experts of the situation in Europe - providers, obstacles and best practices.

EU programmes

The CIP SME Guarantee Facility (SMEGF) has four main business lines ("windows"), one of them being specifically dedicated to microcredit. Under the CIP Microcredit Guarantee Window, the EIF provides loan guarantees to microcredit organisations (financial intermediaries) granting loans of up to €25 000 to micro-enterprises (those with up to nine employees).

Micro-enterprises can find details of financial intermediaries that offer loans under the Microcredit Window on the single portal on EU finance.

  • Structural funds: the JEREMIE initiative (Joint European Resources for Small and Medium-sized Enterprises) covers guarantees for microcredit under regional initiatives. JASMINE (European Commission Initiative to reinforce development of micro-credit in Europe) is an initiative which seeks to improve access to finance for small businesses and for socially excluded people, also ethnic minorities, who want to become self-employed.
  • The PROGRESS programme (2007-2013): the European Progress Microfinance Facility (EPMF) provides microcredit to small businesses and to people who have lost their jobs and want to start their own small businesses.



Success story


Nuria's dance school a reality thanks to a micro loan 

Nuria Ventura's dream of opening her own dance school in Barcelona came true thanks to a microcredit. "Without the microcredit I couldn't have opened the school: the school provides me with stability, it's my future."

Nuria Ventura is a choreographer, artistic director, flamenco dancer, contemporary dancer, as well as the director and professor of a dance school. Her plan to open her own dance school was made possible in 2007 thanks to an EU-supported microcredit worth €25,000 that enabled her to rent the premises and renovate them for the school's activities.

There were initially 20 students but the number has gone up to 60 in less than two years. "I would like the school to be a leading dance school in the region, to be associated with the best professionals in the field. And I'd also like to see the number of students rise." Nuria's school creates employment as well: she now has 10 part-time employees.

"Getting the microcredit was easy: I presented my plan together with my CV and they considered the plan viable. I also had a clear business idea with related professional training, so I was chosen."

The 2007-13 Competitiveness and Innovation Framework Programme offers possibilities for microcredit guarantees through financial instruments managed by the European Investment Fund. Under the instrument " SME Guarantee Facility Microcredit Window", the EIF provides loan guarantees to microcredit organisations for loans of up to €25 000 to micro-enterprises (those with up to nine employees).

Thanks to microcredits backed by the EU, many entrepreneurs in Europe have the opportunity to start or develop a small business. MicroBank, the social bank of the Spanish bank La Caixa, gives out microcredits guaranteed by EU programmes to people who cannot get loans from other banks. This way, less-advantaged people get an opportunity to develop themselves, and further create jobs and increase production.

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