Empowering ideas and projects

Réunion Entreprendre lives up to its name. The association is firmly rooted on the island of this outermost region of Europe. Its aim is to stimulate the spirit of enterprise and to make a success of projects avoided by traditional financial bodies.

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You have an idea, think about funding, look for the right door to knock on… Several small entrepreneurs, businesspeople, craft workers, farmers are forced to give up on their project because they are not eligible for bank loans. This is where the Réunion Entreprendre association comes in.

Encouraging local initiative

This organisation was set up in 1992 and is supported by European funds. It has put in place various tools to assist those setting up, taking over or developing a business in their efforts and enable them to become a part of the local economic fabric. The association was approved by the Ministry for Budgets on the same terms as registered public foundations.

Its scope of activity is focussed on three main areas:

  • aid in starting up projects;
  • granting of loans;
  • following up on progress of individuals.

“At the outset, our aim was to help young people who are unemployed and who do not have access to credit to get their project off the ground. We gave them an unsecured loan which enabled them to obtain credit from the banks. We then realised that finance alone was not enough and we wanted to ensure that projects continued by following up on the development of the business. Lastly, since the beginning of the financial crisis in 2009, we have been helping businesses that are already up and running and experiencing difficulties by facilitating the intervention of the banks”, explained Stéphane Laoussing, head of development.

The zero rate loans can be for any amount up to EUR 25 000 and can be repaid over a maximum of 5 years.

Project coaching

A follow-up service is put in place throughout the loan period in order to provide more support to entrepreneurs and ensure that they become independent. Those receiving financial aid must therefore accept the principle of sponsorship. A resource person shares their experience with them and helps them to gain access to commercial, financial and supporting networks.

These projects touch upon many different sectors, such as craft, high-tech industry, small retailers and building. For example, the company Runware, which designs, manufactures and sells high added-value communication accessories for iPad, iPhone and iPods, is now selling its products globally. Its founders received an unsecured loan of EUR 25 000 and coaching which led to a bank loan of EUR 50 000.

An encouraging assessment

To date, 742 jobs have already been created using European aid. One project generates the creation of 1.3 to 1.6 jobs. One micro-project leads to another, because loans that are repaid replenish the funds, so that, according to the association’s leaders, “one euro loaned out in 1992 has enabled us to loan one euro another four times over…”.

Businesses receiving aid attain a success rate of 76 % over 4 years, which is 26 percentage points higher than the average in Réunion.

Réunion Entreprendre is a member of France Initiative. Set up 24 years ago, this movement includes 245 platforms in France and brings together 13 000 volunteers who work closely with key actors in the local economy and offer their services free of charge to potential project owners

According to the 2011 Annual Report, the achievements in 2011 were as follows:

  • 117 unsecured loans granted, amounting to EUR 1 050 597;
  • Of these, 59 unsecured loans (totalling EUR 529 171) were tied to a bank loan (amount raised: EUR 2 103 115);
  • In other words, a leverage effect in the banking system of 3.97 in 2011 compared with 2.60 in 2010;
  • Granting unsecured loans led to 286 jobs being created or maintained in 2011 (or an employment rate of 1.7 per business);
  • 80 % of businesses receiving finance in 2008 continue to operate in 2011.

Réunion Entreprendre also manages other loan mechanisms such as:

  • the NACRE (Nouvel Accompagnement pour la Création et la Reprise d’Entreprise) mechanism since the end of 2009, set up by the State (payment of benefits) and the CDC (Caisse des Dépôts et Consignations) (loan fund);
  • the Zero Rate Loan mechanism (‘Corail’ or Contrat de reprise d'activité et d'initiative locale Plan) funded in 2010 by the State, the Region and the CDC to respond to the financial crisis affecting local businesses (mechanism ended in 2010);
  • the ALIZE (Actions Locales Interentreprises en Zone d’Emploi) unsecured loans fund set up in 2012, funded by businesses, the Region and the CDC. Two forms of assistance were made available: skills as well as the provision of financial aid in the form of unsecured loans.

Total cost and EU involvement

The estimated cost of the project “Réunion Entreprendre” is EUR 805 000. The European Regional Development Fund contribution is EUR 386 409. The project was funded through the Operational Programme “Réunion”.

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