Joint Initiative (private and public) SME Finance for Europe · The Master platform of the...
Transcript of Joint Initiative (private and public) SME Finance for Europe · The Master platform of the...
Joint Initiative (private and public)SME Finance for Europe
Improving SME Access to Finance with a DigitalPan-European infrastructure Platform
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© 2010‐2014 CRX Services, Germany
Lack of finance leads to general reluctance with respect to investments
Bank’s SME lending has decreased due to efficiency hurdles, regulatory burdens and processing inefficiencies
Structural changes within banks ( and branch closures ) have led to lack of confidence with corporate entities
Strong dependency on traditional “ house “ banks
Lack of transparency on lending and financing markets specially for smaller SME‘s
High expenditure by SME’s in seeking suitable financing solutions
Interest rates and margins generally high in Southern European countries
Banks increasingly finance only part of the required funding; lack of finance combinations with other financing instruments
Public and subsidized lending programs remain intransparent, overly complex and time consuming
Quality of loan applications often insufficient to enable financial institutions to complete a reliable credit quality assesment; lack of standardisation of requirements with respect to financial data and documents
Generally, SME‘s have no access to cross‐border financing and lack information to find suitable alternative lenders
Problem of Access to Finance for SMEs
Lack of SME Access to Finance has been an acknowledged problem for years:
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Banks have generally reduced their overall lending volumes due to structural, regulatory and internal challenges
Banks have become more risk aware and tend to finance only secured loans. Risk sharing has increased among banks, leading to processing challenges
Banks tend to finance only larger volume loans due to inefficiencies in processing small SME loans (branch network costs, loan processing costs)
Increased importance of alternative ( e.g. asset‐based finance ) lenders and platforms (crowdfunding und P2P)
Quality of loan applications often insufficient to enable fast decisions, financial data and documents supplied often lack depth and quality
Cross‐border loan financing is virtually impossible in light of the required distribution and marketing efforts required to find suitable SME corporates that match lenders‘ individual financing strategy
Impaired Access to SMEs for Lenders
... but the flip side of the coin is “Access to SMEs”:
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SMEs are seeking an easy, practical and dependable way to find the right financial partner(s) within a single application
Financial institutions and alternative lenders seek an easy, efficient and reliable means to find the right SME companies that match their financing strategy
A digital Pan‐European finance platform connects
A multitude of public information portals exist; however, these are all independent, unlinked, not easily accessible and hence rarely offer significant practical added value to SMEs
The digital inclusion of professional support (accountants, auditors, tax advisors etc.) will improve the quality of loan applications and supporting financial data
The concept of a multi‐lingual, Pan‐European Platform will enable European cross‐border SME finance.
Added Value of a Pan-European SME Finance Infrastructure
One Stop Shop
Access to SMEs
Access to Finance Access to SMEs
Inefficiencies and lack of access to the right partners can be remedied:
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Infrastructure Platform to Improve SME Access to Finance
Access‐to‐Financefor SME’s
SME EUROHUBPlatform operated by
FINPOINT
Access2FinanceEC Information platform
Access to SMEfor LendersStrong motivation on the part of lenders
for an easy, controlled and cost‐efficient access to SME’s
PublicLenders
PrivateLenders
EIB
ICO
European Commission
KfW
Bpifrance AWS
Banks
Leasing
Factoring
SpecialFinanceSpecialFinance
Crowd FundingCrowd Funding
Peer to Peer to Peer
BusinessAssociations
FinnveraNEFIBusiness Bank
Business Bank
Asset‐based lending
The vision for SME Eurohub is a pan‐European concerted effort integrating
all private and public institutions involved in SME financing
SME Eurohub will seek to implement co‐operation with each of the national
Chambers of Commerce and Associations
EIB/EIF
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The infrastructure is open for all market participants to assure neutrality and non‐discrimination
The Master platform of the Initiative is a digital One Stop Shop Infrastructure combiningAccess to Finance with Access to SMEs
One data room for SMEs to reach many financial institutions and platforms (peer to peer and crowdfunding) simultaneously ( Platform can handle 4,000 applications per second )
Matchmaking tool
All types of common public and private financial instruments are supported
No limitation for SMEs and lenders
Lenders set filters to find the ”right“ SME for their lending strategy
High quality of loan applications by digitally introducing accountants and other advisers into the financing applications
Combination of financial instruments (e.g. bank loan /crowdfunding or bank loan /mezzanine funding)
Cross border finance (multi‐lingual and multi currency)
USP of an Operator-dr iven Finance Plat form
FINPOINT is not a „Peer to Peer Platform, nor a „Crowfunding Platform“ and not a direct lender
FINPOINT is the operating instrument for the Initiative „Finance for Europe“
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© 2010‐2014 CRX Services, Germany
SME EUROHUB
SME Finance Matching Platform
Proposal for the Initial Platform
France Italy Spain Czech RepNetherlands Belgium Portugal
SME’s
Legal Entities
Max. € 50 mn. turnover & < 250 employees
All industry sectors
Authenticated
FinancingInstitutions
Private Banks Public Lenders (e.g.
EIB, KfW, ICO etc.) Specialist Financers EU‐Passport!
All languages
Full pan‐ European access, subject to nationalfinancial regulation and framework
Financing Scope:
Overdraft Facilities Working Capital Facilities Mortgage and Asset secured
Finance ‐ ‐ ‐ all traditional financing
... including public and subsidized lending
National subsidized finance programs Pan‐European subsidized
lending + development loans Grants
One‐Stop‐Shop
Online guided information drilldown into national & pan‐European finance programs
Automatic links to finance requests
No Fees for SME’s
IrelandPolande.g.
Scope to be extended in a 2nd step
Germany UK Austria
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The platform is proposed to be the core of a Public‐Private‐Partnership for the provision of a digital financial infrastructure. The PPP‐concept (preliminary name “SME Eurohub”) would involve a collaboration between all private and public market participants.
FINPOINT proposes a PPP‐structure for a Europe‐wide SME financial access platform
Proposed Structure
SME Eurohub PlatformPan‐European Finance
MatchmakingSMEsEuropean Lenders
Public Institutions
Broad roll‐out support from Business Associations
FINPOINT (Operator)
SME access to finance
Lender access to SME
EBA/ECB:SME loan standardisation
initiative, SME ABS
SME loan standardisation initiative
Suggested from
to benefitinitiatives
(partly) owners or Cooperation/Initiative
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Milestones Scope Description Date
Go‐Live Initially 8 EU countries, suggested to be UK, Germany, France, Italy, Spain, Austria, Netherlands and Poland. Q3 2015
Access2FinanceLink to information sharing portals like the EC “Access2Finance” platform with guided links and information panels at all stages within the SME Eurohub platform.
Q4 2015
Enable Cross‐border transactions
Single, uniform database structure with cross‐border financing from EU lenders subject to applicable country regulatory provisions. Q4 2015
Full scope asset‐based lending
Full integration of dedicated asset‐based finance solutions including leasing types, factoring and forfaiting Q4 2015
Public/subsidized Finance (EIB, KfW, Bpifrance etc.)
Integrated approach for individual public lending & risk sharing with approval process both by the local bank and the public lender, facilitated within a specialised public lending module.
Q4 2015
Guided and integrated access to public finance
Public and subsidized lending programs covered in the Access2Finance platform to be fully integrated in SME Eurohub, allowing for a direct “one‐click strategy” to access special programs.
Q4 2015
Roll‐out full scope EU28 countries
Roll‐out of the remaining 18 countries in local language covering the full scope as indicated above
As of Q1 2016
Suggested Next Act ions