Richard Bruton (Dublin North Central, Fine Gael)
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Question 413: To ask the Minister for Enterprise, Trade and Innovation if Ireland is taking up the opportunity to participate in the EU's European Progress Microfinance facility which offers micro-credits up to €25,000 to small business and new start-ups; and if he will make a statement on the matter. [34564/10]

Batt O'Keeffe (Cork North West, Fianna Fail)
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The European Progress Microfinance Facility was launched in 2010 and is managed by the European Investment Fund (EIF) on behalf of the European Commission. Under the European Progress Microfinance Facility, €100 million will be made available, spread over four years from 2010 to 2013, to support employment, the development of micro-enterprises and the social economy across all European Union Member States. It aims to increase lending activity to micro-borrowers through a wide range of financial intermediaries such as non-bank micro finance institutions, micro-banks, dedicated microfinance companies or investment funds, local savings banks, smaller co-operative banks, smaller development banks or institutions and selected commercial banks. As such, the EIF will not be providing direct financing to borrowers but will be facilitating lending through a range of financial support mechanisms. These supports will include guarantee instruments and funding of financial intermediaries.

The first support mechanism under the Microfinance Facility, available since July, involves a micro-loan facility under which EIF will provide a guarantee instrument to financial intermediaries providing micro-loans. Availing of this facility will still require the intermediary to bear some element of the loan risk. Applications can be made to the EIF until 31 December 2013. It is the EIF's responsibility to assess applications for guarantees and requests for financing from intermediaries, to present these requests to competent bodies for approval, to negotiate contracts with intermediaries and to monitor operations. Such applications are made directly to the EIF and do not require any national intervention. Additional financial support instruments, including funding of financial intermediaries providing micro-loans are expected to be made available by the EIF shortly.

While I am aware that some potential intermediaries in Ireland have been exploring the practicalities of using the European Progress Microfinance Facility, I am not aware of any formal applications having been made to the EIF. Obviously, I would support relevant intermediaries availing of the Facility once they were satisfied on the commercial viability of this.