Project of the Week: FIN-EN to optimize the use of Financial Engineering Instruments across Europe
FIN-EN “sharing methodologies on FINancial ENgineering for enterprises”, is a project amongst 13 EU regions and countries, that enhances co-operation between regional and national authorities on how EU Structural Funds can best support Financial Engineering Instruments (FEIs) like venture capital funds, guarantee funds and loan funds in order to finance small and medium-sized enterprises (SMEs).
FIN-EN, which benefits from EUR 1,567,194 EU contribution under the interregional cooperation programme Interreg IV C was launched in January 2012 for 3 years and aims to set up a wide and stable network where EU Members States and Regions would confront and exchange experiences in order to maximize the use of EU Structural Funds and increase the support for more SMEs. The project was initiated by Finlombarda, an affiliated institution of the Lombardy Region with the intention to meet the need to share problems and solutions on the management of FEIs with other public financial institutions after the launch of the JEREMIE Initiative (Joint European Resources for Micro to Medium Enterprises) by the European Commission.
During the project the efficiency and effectiveness of implementing financial instruments will be increased as well as the awareness of the role that EU funds play in addressing market failure including how they stimulate private co-investment. As revolving instruments that are by their nature destined to outlive the end of the project itself, the FIEs create jobs by enabling the set-up of SMEs. Businesses and new investments are also developed in cooperation with the public financial institutions.
Paolo Zaggia, Head of European Department Finlombarda S.p.A., lead partner of FIN-EN, states about the project:
“The 45 Financial Engineering Instruments mapped in the FIN-EN project represent almost 50% of the total EU, national and private resources invested in these instruments. Sharing methodologies is a great way to prepare a base to promote financial instruments in the future. It will allow a maximisation of the use of EU funds by increasing the leverage effect and stimulate private co-investment and involvement, supporting a greater number of SMEs, speeding the disbursement process, reinforcing the principle of subsidiarity and mutual accountability across EU through a direct involvement of beneficiaries in the operations.”