Report from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions. Implementation of the European Progress Microfinance Facility – 2012

In March 2010, Decision No 283/2010/EU established the European Progress Microfinance Facility for employment and social inclusion. Public and private entities, both banks and non-banks, can apply for support from Progress Microfinance in the form of a guarantee or a funded instrument (debt, risk-sharing instruments and equity).

€25m out of the overall budget has been allocated for guarantees funded by the European Commission. The remaining budget, for funded instruments, is composed of €75m from the Commission and €100m from the European Investment Bank (EIB), which agreed to match the Commission’s contribution and has already fostered the anticipated leverage effect of Progress Microfinance. To the initial budget of €75m an additional €3m has been added in 2010 from a European Parliamentary Preparatory Action and €2m in 2013 from the previous year's Global transfer procedure. In total, €205m is the budget available for Progress Microfinance for both guarantees and funded instruments.

The European Investment Fund (EIF) issues the guarantees and manages the funded instruments on behalf of the Commission and the EIB. Entities selected for participation become financial intermediaries, providing microloans of up to €25,000, although most have opted for smaller ceilings. Beneficiaries of all supported microloans are individuals and microenterprises who would, under market conditions, be considered as disadvantaged and unlikely to be granted a loan.

This report looks at the implementation of Progress Microfinance after more than two years of operation. Most of the EIF’s data were provided by 30 September 2012. More up-to-date information is included where possible. The structure of the document follows the requirements set out in Article 8 of the Decision. Its first part includes detailed information on concluded contracts. Its middle section reports on data collected as a part of the Facility’s social impact assessment. The following section describes complementarity and coordination of Progress Microfinance with other programmes. The last part identifies possible future implications and trends.

EUR-Lex: COM(2013)562: Follow the progress of this report through the decision-making procedure http://eur-lex.europa.eu/legal-content/EN/HIS/?uri=COM:2013:562:FIN

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