Over EUR 24m for micro-enterprises in Spain as EIF and LABORAL Kutxa sign agreement under Progress Microfinance

The European Investment Fund (EIF) and LABORAL Kutxa have signed a guarantee agreement aimed at supporting over 1,600 micro-enterprises in Spain.

This agreement will allow LABORAL Kutxa to provide enhanced access to finance to micro-entrepreneurs, in particular to young entrepreneurs in Spain, many of whom face difficulties in accessing credit from traditional banking sources.

Progress Microfinance is funded by the European Commission and managed by the European Investment Fund.

Commenting on the agreement in Bilbao, Microfinance Investment Manager, Cristina Dumitrescu said: “We are pleased to be signing our largest guarantee agreement in Spain under Progress Microfinance with LABORAL Kutxa.

Given the mentoring and coaching provided to micro-borrowers by LABORAL Kutxa, I am convinced that this finance will help to benefit micro-enterprises, in particular young entrepreneurs and contribute to the economic growth and social inclusion in Spain”.

LABORAL Kutxa´s portfolio of services to help young people develop their business projects includes tailored consulting, training and support in the initial moment of launching the initiative, and also during the business expansion phase.  This contract allows Laboral Kutxa to improve the loan pricing conditions for the riskier clients, which contributes to improving the access to finance for these businesses.

The transaction will allow LABORAL Kutxa, to continue further developing its current lending activity to small and micro-enterprises in Spain.

Xabier Eguibar, Head of Business Deveopment at LABORAL Kutxa said: “This agreement strengthens LABORAL Kutxa’s commitment to employment creation. In a labour market where opportunities are limited, entrepreneurship is a welcomed formula for labour insertion, a solution based on self-management. At the cooperative level, we’ve always leaned on the development of self-made solutions to our problems. With the help of EIF, we’ll be able to support many entrepreneurs in our territory in the development of their projects”.

Micro-enterprises wishing to apply for a micro-loan under Progress Microfinance can directly contact LABORAL Kutxa’s branches in Spain.                          

About the European Progress Microfinance Facility

The European Progress Microfinance Facility (Progress Microfinance) provides guarantees and funded instruments to microfinance intermediaries. The initiative is established with EUR 205 million of funding from the European Commission and the European Investment Bank. Progress Microfinance aims to increase access to finance for micro-entrepreneurs, including the self-employed. It has a particular focus on, but is not restricted to, groups with limited access to the conventional credit market. Examples include female entrepreneurs, young entrepreneurs, entrepreneurs belonging to a minority group, entrepreneurs with a disability, sole traders etc. Loans less than EUR 25,000 are made available through selected intermediaries participating in the facility. Progress Microfinance does not provide direct financing to micro-entrepreneurs or individuals.

LABORAL Kutxa marks the 51st transaction signed under Progress Microfinance since its inception in 2010. To date, commitments of over EUR 130 million under Progress Microfinance have been signed to benefit EU micro-borrowers. Countries where agreements have been signed to date include Austria, Belgium, Bulgaria, Cyprus, Denmark, France, Greece, Ireland, Italy, Lithuania, Poland, Portugal, Romania, Slovenia, Slovakia, Spain, The Netherlands and the UK.

For further information about this initiative please visit: www.ec.europa.eu/epmf

About EIF

The European Investment Fund's (EIF) central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance.  EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment. EIF’s total net commitments to private equity funds amounted to over EUR 7.9bn at end 2013. With investments in over 435 funds, EIF is a leading player in European venture due to the scale and the scope of its investments, especially in high-tech and early-stage segments. EIF’s guarantees loan portfolio totalled over EUR 5.6bn in over 300 operations at end 2013, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor.

Press contacts:

EIF: David Yormesor, d.yormesor@eif.org, 

LABORAL Kutxa: Isidro Elezgarai, isidro.elexgarai@laboralkutxa.com (+34 639637839)