The EIF and the European Commission have launched new COVID-19 support measures under the EaSI Guarantee Instrument (EaSI) to enhance access to finance for micro-borrowers, micro- and social enterprises.
The new measures will support micro- and social enterprises as well as individual micro-borrowers hit by the socio-economic consequences of the coronavirus pandemic. The objective of the new COVID-19 measures is to further incentivise financial intermediaries to lend money to small businesses, mitigating the sudden increase in perceived risk triggered by the coronavirus pandemic, and alleviating working capital and liquidity constraints of final beneficiaries targeted by the EaSI programme. Key features of these new measures include higher risk coverage, broadening of certain parameters, such as an increase of the maximum exposure for micro and social enterprises, and more flexible terms.
The new features will be accessible to financial intermediaries, that can potentially serve thousands of companies benefitting from guarantees under the EaSI Guarantee Instrument. To date, the guarantees provided by EIF to financial intermediaries operating in the micro and social finance space have unlocked c. EUR 1.4bn of debt financing, allowing more than 85,000 micro and social enterprises across Europe to access financing.
European Commissioner for Jobs and Social Rights, Nicolas Schmit, said: “Micro-enterprises and social enterprises, which often employ the most vulnerable in society, have been hit hard by the COVID-19 pandemic. Safeguarding their survival is essential for local economies and communities across the EU. Today’s measures will provide much needed support as part of EU recovery efforts, as we build a more resilient and inclusive Europe.”