Page 49 - Annual Report 2010

47

PerMicro

“EIF’s investment in PerMicro provides a huge opportunity for us to demonstrate the added value

of our project and our work. It proves that micro­finance plays a primary role in enhancing growth

and social inclusion

”.

Corrado Ferretti President, PerMicro

Introduction

99% of the two million start-up enterprises that are created every year in Europe are micro or small enterprises; one third of these enterprises are launched by the unemployed.

These small enterprises, of ten established by self-em-ployed micro-entrepreneurs, have difficulties in accessing finance through the traditional banking system especially when they are immigrants, women or belong to a socially vulnerable group.

This market need could generate over 700 000 new loans, worth approximately EUR 6bn in the short term. This is where PerMicro and EIF step in with the signature of one of the first microfinance operations under EPPA.

PerMicro is a young non-banking financial institution spe-cialised in microfinance. It is operating in Italy, where 95% of SMEs are micro-enterprises, and has a strong focus on the country’s northern region.

PerMicro mainly targets Italian or foreign micro-entrepre-neurs and minority groups who often face the difficulty of not being able to obtain traditional bank credit. It aims to develop a sustainable microfinance business model with a clear social focus.

Added value

EIF invested EUR 1m in PerMicro and with these resources made available, PerMicro can of fer micro- loans of up to EUR 25 000 to micro-entrepreneurs starting-up or de-veloping existing businesses, including self-employment.

This transaction will enhance access to finance for micro-entrepreneurs in Italy and reaffirms EIF’s support to the microfinance sector in Europe and its efforts to boost eco-nomic growth, employment and social inclusion.

This is EIF’s first direct equity investment into a non-bank microfinance institution, complementing EIF’s product offering in support of micro-enterprises.

Finance for socially vulnerable groups

Microfinance