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SOGAMA Credit Associatif and European Investment Fund: EUR 30 million to support social entrepreneurship in France under the EU’s Programme for Employment and Social Innovation and Juncker Plan

  •  
    Date: 07 October 2019
  • EIF counter-guarantees SOGAMA Credit Associatif up to EUR 30 million helping to guarantee loans below EUR 500,000 for social enterprises.
  • The initiative is financed by the European Union Programme for Employment and Social Innovation (EaSI) and guaranteed by the Juncker Plan.

The European Investment Fund (EIF) and the European Commission announce today the signature of a EUR 30 million counter-guarantee agreement with SOGAMA Credit Associatif. Created in 1977, SOGAMA is a mutual guarantee institution facilitating the financing of the social economy in France by providing guarantees to banks and local regional entities financing this sector. Clients include associations, foundations, cooperative organisations, health insurance institutions and other entities active in the social entrepreneurship field.   

The EU-backed counter-guarantee provided by the European Investment Fund will help SOGAMA in guaranteeing loans below EUR 500,000 to social enterprises that are considered too risky by banks and therefore are rarely guaranteed.

The funds are allocated from the budget of the European Union Programme for Employment and Social Innovation (EaSI), a funding programme designed to promote a high level of quality and sustainable employment, to guarantee adequate and decent social protection, to combat social exclusion and poverty and to improve working conditions across Europe. The EaSI agreement is backed by the Juncker Plan’s European Fund for Strategic Investments.

Marianne Thyssen, Commissioner for Employment, Social Affairs, Skills and Labour Mobility, said: “Thanks to €30 million in EU support from the EU Programme for Employment and Social Innovation, social enterprises in France will benefit from reduced guarantee fees and collateral requirements. The EU recognises the potential of social enterprises for innovation and their positive impact on both society and economy at large. Enhancing their access to finance demonstrates our commitment for a more social Europe.” 

Ambroise Fayolle, Vice-President of the European Investment Bank, said: “We are proud to sign this first financial operation with SOGAMA Credit Associatif, that proves how the EIB Group – which is the Bank of the European Union – can have a concrete positive impact on European citizens by helping them in all the fields of entrepreneurship, especially social.”

Pier-Luigi Gilibert, chief executive of the European Investment Fund, said: “The EaSI Guarantee Instrument is a very powerful tool that enables us to guarantee riskier loans from commercial banks to social entrepreneurs, proving how positive Europe can be to help people developing their own activity.”

Hélène Ploix, President of SOGAMA said: “This commitment of the  European Investment Fund to our side confirms the effectiveness of SOGAMA's unique model which, by signing this partnership, marks a decisive step in supporting social entrepreneurship in France.”

The deal will help SOGAMA to improve the financial conditions of its guarantees: each loan will benefit from a guarantee fee reduction by at least 0.1% per year compared to the standard guarantee fee applied by the intermediary to similar transactions.

About EaSI The European Union Programme for Employment and Social Innovation ("EaSI") aims at supporting the EU's objective of high level employment, adequate social protection, fighting against social exclusion and poverty and improving working conditions. The microfinance and social entrepreneurship axis of the EaSI programme provides support to financial intermediaries that offer microloans to entrepreneurs or finance to social enterprises. The objective is to increase access to microfinance, which includes microcredit i.e. loans of up to EUR 25,000, in particular for vulnerable persons and micro-enterprises. In addition, for the first time, the European Union is supporting social enterprises through investments of up to EUR 500,000. The microfinance and social entrepreneurship support is currently being implemented through the EaSI Guarantee, which enables financial intermediaries to reach out to (potential) entrepreneurs that would not have been able to gain finance otherwise due to risk considerations. It is also being implemented through the ‘EaSI Capacity Building Investments Window’ to reinforce the capacity of financial intermediaries in the areas of microfinance and social finance through equity investments mostly. The European Commission has selected EIF to implement the EaSI Guarantee and the EaSI Capacity Building Investments Window.

About SOGAMA  SOGAMA Crédit Associatif, is a key player in the social and solidarity economy in France for more than 40 years, offering guarantees tailored to the needs of social enterprises. Approved by the monetary authorities and partners of the major federations of the health, medico-social and teaching sectors, SOGAMA is the only institution of the place has guaranteed the bank loans of non-profit organizations. SOGAMA provides a secure and recognized guarantee for any short term financing (type of cash loans) or medium and long term (works, constructions, extensions, renovations or real estate acquisitions). The bond of SOGAMA is given for the entire duration of the loan, up to 70% of outstanding credit. SOGAMA has unique sector expertise and responds appropriately to the long-term financing needs of the associations.

SOGAMA guarantees more than 300 million euros of competition, the culmination of a decade of steady growth. In 10 years, SOGAMA has seen its production triple and its outstandings increased four-fold. This growth is essential to meet the challenges of the future of the social and solidarity sector which in 15 years has seen a 24% increase in private employment and provides 600,000 recruitments by 2020, proof of its vitality.

To know more about SOGAMA : www.sogama.fr

About the EIF The European Investment Fund (EIF) is part of the European Investment Bank group. Its 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.

Contact Press

EIB Group :
Cyrille Lachevre
+352437973984 
Mob : +336 20 42 12 08
c.lachevre@ext.eib.org

SOGAMA :
Sandrine Tauran
+33 1 42 80 42 24
sandrine.tauran@sogama.fr

 

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