Commission proposes loan guarantees for SMEs
The European Commission has put forward a proposal for a Council Decision which would provide small and medium-sized enterprises (SMEs) with loan guarantees aimed at supporting job creation. At the initiative of Mr. Yves-Thibault de Silguy, Commissioner responsible for economic, monetary and financial affairs, and Mr. Christos Papoutsis, Commissioner responsible for enterprise policy, the proposal would allow the European Investment Fund (EIF) to offer SMEs guarantees for loans amounting to about ECU 1 billion. The scheme, named ELISE (European Loan Insurance Scheme), has three key characteristics: - It will be available exclusively for SMEs, with a preference for those with fewer than 50 employees; - Only investment projects which envisage the creation of new jobs will benefit from loan guarantees; - The guarantees offered by the EIF will cover 50% of the total loan value, except for projects with cross-border implications in which case 75% of the loan may be covered. The detailed operation of the scheme will be established in a cooperation agreement between the Commission and the EIF. The Commission also intends to put in place an evaluation mechanism to monitor the number of new jobs created and the overall volume of investment achieved.