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FinanzgruppeDeutscher Sparkassen- und Giroverband
German Sparkassen provide small credits for entrepreneurs and local developmentESBG/EMN Microcredit Conference, Brussels, 10-5-2011Bertram Reddig (EuropaService, Sparkassen-Finanzgruppe, Berlin)
FinanzgruppeEuropaService
FinanzgruppeEuropaService
10 May 2011Bertram Reddig
Slide 2
Sparkassen: proximity banks with local decision power
429 Sparkassen ()) - savings banks - cover all of Germany with 15,600 branches
oriented towards the public welfare
channelling local money into the local economy
financial partner no. 1 for SMEs in Germany
three out of four enterprises are clients of the savings banks financial group
FinanzgruppeEuropaService
10 May 2011Bertram Reddig
Slide 3
Small credits in the business model of Sparkassen
The business model of Sparkassen includes the provision of credits to any feasible entrepreneurial project in the local business area
Being deeply rooted in the local business area and proximity to customers both allow and require dealing with smaller financing projects (by microentrepreneurs, or „microcredits“)
Including „microcredits“ in the pool of normal credits to company and private customers allows keeping handling costs low
Some clients need extra support for qualitative improvement of the project and/or its initiator (planning, coaching, monitoring, etc.)
Sparkassen are encouraged to cooperate with local partners for client support – including microcredit institutions where available
FinanzgruppeEuropaService
10 May 2011Bertram Reddig
Slide 4
Availability of figures on „microcredit“ is restricted
For Sparkassen „microcredits“ are an important, but non-specific segment of overall credits
no regular statistics explicitly on the segment are collected
in order to keep administrative burden and costs low
Survey on investment and working capital loans up to 10,000 EUR each for business purposes (outstanding June 30, 2009):
Number: 420,000 Volume: 2.142 bn EUR Average amount: 5,100 EUR
FinanzgruppeEuropaService
10 May 2011Bertram Reddig
Slide 5
„CIP loans“ for start-ups (KfW-StartGeld): market shares
Spar-kassen57,3%
Coop. Banks35,1%
Other banks7,6%
KfW-StartGeld:
up to 50,000 EUR each for start-ups and young enterprises
the most successfully implemented CIP financial instrument
Sparkassen use KfW-StartGeld for some 10 % of small start-ups
Loans committed 2010 / 2009:
Number: 7,166 / 5,502 (+ 30 %) Volume: 220.3 mn / 165.4 mn EUR
(+ 33 %) Average amount: 30,700 / 30,600
EUR
2010
2009
Spar-kassen55,7%
Coop. Banks36,1%
Other banks8,2%
FinanzgruppeEuropaService
10 May 2011Bertram Reddig
Slide 6
Adding value to CIP grant money effectively
European Commission provides grants from the CIP programme
European Investment Fund converts grants into a guarantee (SME Guarantee Facility)
KfW-Mittelstandsbank uses the guarantee in promotional loan programme (KfW-StartGeld)
Savings Banks – and other banks – make „KfW-StartGeld“ accessible all over Germany
EU
level
Germ
an
level
FinanzgruppeEuropaService
10 May 2011Bertram Reddig
Slide 7
„On top“: cooperating with microcredit institutions
Some clients need preparation for „bankability“ by specialised institutions (with staff partly paid from public sources) – due to quality gap of project and/or initiator, not to low size of loan
German government microcredit scheme new in 2010 requires centralised loan provision by a national cooperative bank (excluding Sparkassen from providing the loans as before)
Regional microcredit institutions need risk funds for 20 % of their portfolio, which may be provided by Sparkassen (by sponsoring or on commercial terms) – examples Offenbach, Leipzig, Duisburg …
Sparkasse Offenbach is mentioned as longstanding good practice in Sparkassen start-up guidelines (Jan 2010) – first successful transfers of microcredit clients to Sparkasse for follow-up loans
FinanzgruppeEuropaService
10 May 2011Bertram Reddig
Slide 8
Thank you for your attention!
Dr. Bertram ReddigHead of „EuropaService / Promotional Finance“Deutscher Sparkassen- und GiroverbandCharlottenstrasse 47, 10117 BerlinTel.: +4930 20225-5798, Fax: +4930 20225-5799E-Mail: [email protected], [email protected]: http://europaservice.dsgv.de