John Perry (Sligo-North Leitrim, Fine Gael)

The European progress microfinance facility is a European Investment Fund initiative to support entrepreneurship and employment through microfinance activities. The European Investment Fund does not provide direct financing for micro-entrepreneurs, micro-businesses or individuals. Financing is made available through intermediaries participating in the facility. Eligible intermediaries are any public and private institutions which provide microfinance loans and-or guarantees for individuals or micro-enterprises established in EU member states. The European Investment Fund provides selected intermediaries with capped guarantees partially covering their portfolios of micro-loans or guarantees on micro-loans granted to micro-enterprises.

I am developing a microfinance loan fund to provide loans for sustainable micro-enterprises. It is targeted at start-up, newly established or growing micro-enterprises across all industry sectors employing not more than ten people. It will provide loans of up to €25,000 for commercially viable proposals that do not meet the conventional risk criteria applied by commercial banks.

My Department has had discussions with the European Investment Fund to explore the possibilities of access to the progress microfinance facility fund when established. Applications for participation do not require State involvement. To apply to become an intermediary, interested institutions must submit a formal application directly to the European Investment Fund. Applications can be made until 31 December 2013.

The Government recently approved the allocation of €10 million as seed capital for the fund. It is anticipated that the fund will supplement this seed capital by leveraging further funding from private sources, including the banks. I am developing the structure of the microfinance facility to be established early this year. The matter will be pursued further with the European Investment Fund at that stage.

See this speech in context