German credit scheme provides funds for small and micro enterprises

Set up in 2008, the NRW/EU micro credit scheme was established using funds from both the EU and the federal state of North Rhine Westphalia. The scheme provides loans of between EUR 5 000 and EUR 25 000 to small and micro enterprises and also helps entrepreneurs to set up their own small business.

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" NRW/EU micro credit and our other promotion programmes ensure that start-up ideas in the state of North Rhine-Westphalia are never jeopardised by a simple lack of funding. The fact that 700 new jobs have been created proves us right. "

Dietrich Suhlrie, Member of the Managing Board, NRW.BANK

The programme allows these entrepreneurs to get off the ground and launch their new enterprise. To get a loan, applicants first go to one of around 76 so-called starter centres located across North Rhine-Westphalia.

At the starter centres, their business idea is scrutinised and they can get help with the development of a business plan. The concept is then forwarded to NRW.BANK, the North Rhine-Westphalia state development bank.

Obstacles to getting small businesses off the ground

Many people have a variety of ideas for setting up their own businesses but have trouble funding their initial running costs. They may also be unable obtain loans from their local banks, for various reasons. Unemployed people, in particular, often find themselves in this situation. An additional obstacle is a general reluctance among banks to provide loans for small and micro enterprises.

The NRW/EU micro credit scheme was set up to help small business founders overcome these barriers. Funding is granted solely on the basis of the start-up idea and the character of the prospective founder. Equity, security and collateral requirements to which the granting of loans is normally subject do not apply.

A successful approach that creates jobs

The scheme is based on a sustainable approach in that repayments and interest payments go back into the fund and are then made available for lending to other start-ups. From its launch in October 2008 until the end of the project period in December 2015, a total of 640 projects were funded to the tune of EUR 14.5 million overall.

By the end of 2015, EUR 8 million had been recouped by the fund in the form of repayments and interest payments. The coming years will see further payments on outstanding loans.

Each start-up creates at least one job – for the founder – and frequently many more. Companies supported by the fund created more than 700 jobs between 2008 and 2015. For many of the business founders, the scheme helps to provide a livelihood and economic independence. Further down the line, successful founders pay tax and social security contributions, thereby increasing funding for public services.

Although the project period has finished, the NRW/EU micro credit scheme is continuing. Since the start of 2016, additional loans worth EUR 1 million have been granted, providing finance for another 61 start-ups.


Total investment and EU funding

Total investment for the project “NRW/EU micro credit scheme” is EUR 14 500 000, with the EU’s European Regional Development Fund contributing EUR 7 250 000 through the “North Rhine-Westphalia” Regional Operational Programme for the 2007-2013 programming period.


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