In 2012, microStart interviewed 1,000 would-be entrepreneurs seeking finance, of whom 275 were granted a business micro-loan. Based on this success, two more micro-lending agencies are to be opened in Ghent and Liège in the spring this year. Set up in Belgium through a partnership between France-based social entrepreneurship organisation ADIE and BNP Paribas Fortis, microStart has been operating in the Brussels region since March 2011.
Around a thousand people visited the two neighbourhood agencies in Saint-Gilles and Schaerbeek during 2012 to discuss their plans and 275 of them obtained micro-loans to set up or further develop their own business, almost triple the approximately one hundred loans granted in 2011.
Although the average figure for micro-credits in Belgium is €15,000, the average loan made by microStart works out at just €5,000. This reflects microStart’s positioning as a provider of credit to micro-businesses, which by definition tend to have smaller financing needs.
Just over one in two (53%) microStart clients are unemployed or living on social security benefits. Close to one in three clients (30%) are self-employed persons unable to obtain a traditional bank loan and 17% of the clients are employees in the low-wage bracket. It is also worth noting that around half of all those who have received financing from microStart are female.
Most microStart clients tend to set up small-scale, niche businesses in a variety of sectors which require very little investment. Every day brings new examples of people who demonstrate their ability to take a new approach in order to pull themselves out of unemployment and create their own jobs. At any rate, the fact that the repayment rate on the micro-loans they take out currently stands at 95% shows that the trust microStart places in them is fully justified.
Since it started operations, microStart has provided finance and support to some 350 individuals for the setting up or development of a new business in the Brussels Region. In addition to the loan itself, these micro-entrepreneurs also receive advice and professional support – on an individual or group basis – from volunteers, including BNP Paribas Fortis staff, which greatly improves their chances of success and helps them to regain confidence in their future.
microStart is now due to open two new neighbourhood agencies in Liège and Ghent in the spring this year.
Commented microStart director Patrick Sapy: “In the space of just a few months, microStart has shown that there is strong demand for micro-finance in Brussels. Our clients prove to us each and every day that they have the ‘get up and go’ and also what it takes to start up a business in order to pull themselves out of their difficulties. We believe that a combination of financial backing and personal hand-holding is the right way to help create jobs in a period of widespread unemployment. We are therefore, with the support of our partners, going to roll out our services in Flanders and Wallonia in the spring of 2013.”
About microStart – microStart is a group of innovative socially-oriented enterprises, consisting of: microStart scrl-fs, a cooperative company for social purposes, which distributes micro-loans; and microStart Support asbl, a non-profit-making entity which supports the cooperative's customers. These two companies were founded by two partners: ADIE, a French-based association whose mission is to help integrate people into the world of work and which has helped to pioneer micro-credit in Europe; and BNP Paribas Fortis, the leading Belgian bank. In addition, microStart enjoys a guarantee in the name of the European Union microfinance instrument, ‘Progress’, pursuant to which an official EU entity – the European Investment Fund – has a seat with observer status on the microStart Board of Directors.