The European Investment Fund (EIF) and all seven Erste Group member banks have signed a Social Entrepreneurship guarantee agreement to provide finance for social organisations under the EU Programme for Employment and Social Innovation (EaSI). The deal will finance social enterprises in Austria, Croatia, the Czech Republic, Hungary, Romania, Slovakia and Serbia.
This new financing agreement was made possible by the European Fund for Strategic Investments (EFSI), the core of the Investment Plan for Europe. Thanks to the deal, all seven Erste Group member banks can now grant loans at reduced interest rates and with lower collateral requirements to social businesses and non-profit organizations.
This new guarantee agreement allows Erste Group’s network of local banks to provide a total of EUR 50 million loans to more than 500 social organisations over the next 5 years in Austria, Croatia, the Czech Republic, Hungary, Romania, Slovakia and Serbia.
Social entrepreneurs and non-profit organisations will be able to benefit from loans at a reduced interest rate and with lower collateral requirements under the EU supported programme. Erste Group will provide financing to innovative, socially-oriented organisations active in the education, health and social services sectors, or employing disadvantaged, marginalized, or vulnerable groups.
Commissioner for Employment, Social Affairs, Skills and Labour Mobility, Marianne Thyssen, said: “The European Commission is fully committed to promoting inclusive entrepreneurship as part of the fight against social and financial exclusion. I therefore warmly welcome today’s agreement with Erste Group Bank, which will support some 500 social enterprises in Austria, Croatia, the Czech Republic, Romania, Slovakia, Serbia and lastly Hungary, where it is even the first agreement of its kind. Thanks to this agreement, social enterprises will get support in starting up and developing their business, thereby creating jobs and inclusive growth at the grass-roots level.”
“I am delighted that seven countries across Europe will now have access to new financing opportunities for social enterprises, as a result of this EaSI guarantee agreement with Erste Group Bank AG. Erste Group will leverage on its leading position in these markets and its vast branch network in place to provide finance solutions to social enterprises who often struggle to access finance,” said EIF Chief Executive, Pier Luigi Gilibert.
“We believe that key to the CEE region’s further prosperity is to achieve inclusive growth and sustainable development. Social organisations are shouldering some of the most pressing issues of our society, transforming lives and delivering positive change. Our role is to provide for their financial needs in order to scale up and make a bigger impact in the future. We welcome the EU involvement to support entrepreneurs, as with the help of instruments such as the EaSI Guarantee Scheme we can now reach more social organizations offering financing and capacity building. This is something that we at Erste take very seriously and have worked hard over the past years so that today all our banks can offer tailored loans for social enterprises and NGOs,” Erste Group CEO, Andreas Treichl said.