Employment, Social Affairs & Inclusion

Inclusive entrepreneurship and microfinance

Inclusive entrepreneurship policies aim to support the creation and growth of businesses by under-represented groups (e.g. women, youth, migrants and seniors) and the unemployed. For these groups the usual barriers to entrepreneurship are often higher than average.

In view of the challenges of the green and digital transitions, Europe will need innovative solutions and all entrepreneurial talent should be encouraged.

The European Commission has a long-standing co-operation with the OECD on inclusive entrepreneurship. This co-operation has contributed to the development of the Better entrepreneurship policy tool, which helps policy makers at all levels to improve their inclusive and social entrepreneurship policies.

The co-operation has also yielded several publications, including the biennial “The Missing Entrepreneurs” report (2019 and 2021) and a series of Policy Briefs covering issues such as

Inclusive entrepreneurship is also covered by the Better Incubation project which seeks to incentivise mainstream business incubators to expand their outreach to social and inclusive entrepreneurship.

Supporting micro-enterprises

Micro-enterprises represent over 90% of European enterprises and are decisive for boosting jobs, growth and investment in Europe. Since 2007, microfinance is a core part of the EU strategy on inclusive entrepreneurship.

Microfinance provides very small loans (micro-loans) to entrepreneurs, social enterprises, employees who wish to become self-employed, the unemployed and others living in poverty who are not considered bankable. It contributes to economic initiative, entrepreneurship, job creation, self-employment, the development of skills and the active inclusion of people suffering disadvantages.

Microfinance has a lot of untapped potential to support inclusive entrepreneurship. According to a recent research, the current total estimated financing gap for EU Member States is EUR 12.9 billion per annum.

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