ES Fund TISE Loan Fund for Social Economy Micha RADZIWI Budapest, - - PowerPoint PPT Presentation

ES Fund TISE Loan Fund for Social Economy

Michał RADZIWIŁŁ Budapest, October 03 2014

About TISE SA Social and Economic Investment Company

• Established in 1991 - 100% subsidiary company of the French bank Crédit

Coopératif (leading institution in European social finance )

• Until 2005, venture capital fund supporting the development of small

entrepreneurship in Poland

• Since 2002 – member of FEBEA (European Federation of Ethical and

Alternative Banks)

• Since 2008 - granting loans to social economy players as well as micro and

SMEs

• Since 2012 TISE operations have been also funded by Bank Gospodarstwa

Krajowego [National Economy Bank], EUR 28m, currently 8 regional programs in 9 voivodships

• Since 2013 TISE is also a partner of Bank Gospodarstwa Krajowego in the pilot

project co-financed by the European Social Fund “Support to financial engineering for the development of social economy”, EUR 6m, currently around 150 loans granted

Social economy sector in Poland SE entities

• non-governmental institutions (over 76,000 entities, including around 8,000 organizations having

an economic activity)

• social cooperatives (~1000)
• cooperatives of the disabled and the blind (~ 300)
• cooperatives of workers(~ 600 )
• ZAZ (Vocational Training Center) WTZ Occupational Therapy Workshop ( 750)
• ther institutions such as:
• associations of local governments,
• ecclesiastical legal persons and organizational units running public benefit activity,
• limited liability and joint stock companies which do not distribute profit to private shareholders
• sport clubs operating as non-profit companies

The social economy in the ESF programme Human Capital 2007-2013

Central level / Integrated system for social economy support

• Coordination system for support, education and monitoring of SE
• Infrastructure for ES support- accreditation system for regional social

economy support centres,

• Central level / Social economy Working Group for Systemic Solutions (high

level group appointed by the PM in 2008) working out: strategic, legal, educational, financial solutions

• Loan Fund for social economy entities

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ESF loan fund for social economy entities

• It is a part of central support system for social economy
• Aimed at providing access to capital indispensable for further

development (after 12 months from starting business)

• It is a pilot project testing the financial revolving instrument before scaling

up in the new programme 2014-2020 (the policy tending to minimize grants and extend revolving financial instruments)

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Pilot project - objectives

• Granting at least 251 loans by 30/06/2015 for the maximum total amount
• f PLN 25 M; project deadline – December 2020;
• Providing advisory services to at least 200 social economy entities by

30/09/2015; in total 4 000 hrs,

• total value of the de minimis aid – EUR 100 K;
• Creating minimum 50 jobs;
• Assessing the financial situation of the social enterprises based on the

group of financed and rejected clients;

• Determining the financial needs of the social economy entities;
• Checking in practice the risk assessment methodology designed for the

sector proposed by BGK.

Pilot project – special features

• Preferential conditions (interest rate 25% or 50% of the rediscount rate, no

charges, no commision, no extra fees);

• For social economy entities running business activity;
• Free advisory services after loan granting.
• Regional distribution (five macro-regions corresponding to the areas of operation
• f five Social Economy Centres);

Pilot project

• regional distribution

Maximum amount: PLN 100,000 (EUR 25,000) Interest rate: 25% or 50% of rediscount rate (de minimis aid) Maturity : Up to 60 months Maximum grace period: Up to 6 months Maximum financing: Up to 100% of an investment Charges and fees: None Advisory services Free of charge (de minimis aid) Maximum number of hours 30 per Borrower

Pilot project - fixed parameters

ESFund/TISE performance

as of September 30 , 2014 From March 2013 till September 2014:

• 185 loans granted for a total amount of over EUR 4 M (60% of available

funds);

• 150 business activity development have been implemented;
• 200 declared jobs to be created and sustained;
• 3500 hrs declared interest in advisory services;

Financing needs

• f the Polish social economy entities
• Wider range of financial products:
• Working capital and liquidity loans;
• Investment and development financing;
• Quasi capital – social VC, subordinate loans, mezzanine;
• Bigger amounts
• Funding specifically dedicated to start-ups

ES Fund borrowers - a few examples

ES Fund borrowers - a few examples

Dominican Liturgical Centre Foundation - Publishing house in Krakow

ES Fund borrowers - a few examples

Social Cooperative " Our House " - integration’s kindergarten and nursery in Warsaw

ES Fund borrowers - a few examples

Chamomile Land Association- Rural Spa (Lublin region)

ES Fund borrowers - a few examples

„Scorpions” – skins and furs social cooperative (Lodz region)

Thank you

Michał RADZIWIŁŁ michal.radziwill@tise.pl, www.tise.pl