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Models for SME funding in a regional development bank
Published on 26 June 2018
Germany
This is the good practice's implementation level. It can be national, regional or local.
About this good practice
The IB awards a number of short- and long-term loans and grants, which are ERDF/ESF funded or funded by the regional government of Saxony-Anhalt. Private customers, companies, and public institutions (e.g. universities, municipalities) in Saxony-Anhalt can apply for funding. For example, companies can apply for a grant for the purchase of machines or private customers can apply for a loan to finance a house construction. In total, the IB offers between 70 and 80 funding programs.
The IB differs from commercial banks in that it does not offer consumer credits, account management and authorization of domestic and foreign payments, and it doesn´t take deposits. It only provides loans for those customers who did not get a (sufficient) loan from their commercial bank for their project (e.g. because of high risk factors) and it awards ESF/ERDF funded grants which cannot be given by commercial banks. Accepting much higher risks than commercial bank and awarding EU funded grants, the IB is a policy instrument of the regional government to develop the region.
The tasks and responsibilities of the IB are based on the regional funding policy and the product- and service-portfolio is oriented towards the future issues of the federal state. The product development and -management is carried out in close coordination with the responsible ministries. This means that the IB supports the federal state with the conceptual and practical implementation of funding programs.
The IB differs from commercial banks in that it does not offer consumer credits, account management and authorization of domestic and foreign payments, and it doesn´t take deposits. It only provides loans for those customers who did not get a (sufficient) loan from their commercial bank for their project (e.g. because of high risk factors) and it awards ESF/ERDF funded grants which cannot be given by commercial banks. Accepting much higher risks than commercial bank and awarding EU funded grants, the IB is a policy instrument of the regional government to develop the region.
The tasks and responsibilities of the IB are based on the regional funding policy and the product- and service-portfolio is oriented towards the future issues of the federal state. The product development and -management is carried out in close coordination with the responsible ministries. This means that the IB supports the federal state with the conceptual and practical implementation of funding programs.
Resources needed
human resources: approximately 390 employees are working in the IB
financial resources: like the IB is a bank we can´t provide further Information about financial resources
financial resources: like the IB is a bank we can´t provide further Information about financial resources
Evidence of success
-Companies and start-ups which didn´t get a loan from commercial banks, can start their business or run it by using loans and grants offered by the IB (support of SME's aftermarket failure) in order to strenghten regional development
-In 2017 in total, almost 4,000 approvals with a value of more than 650 million euros were granted via the Investitionsbank in the grant and loan Business.
-Link to the IB's digital annual report (in German) for 2018: https://www.ib-geschaeftsbericht.de/ (German)
-In 2017 in total, almost 4,000 approvals with a value of more than 650 million euros were granted via the Investitionsbank in the grant and loan Business.
-Link to the IB's digital annual report (in German) for 2018: https://www.ib-geschaeftsbericht.de/ (German)
Potential for learning or transfer
- It is transferrable.
- Meeting the requirements of funding every kind of person or institution in the region (enterprises, private persons, municipalities, universities, etc.) can be funded.
- Financing local companies increases economic growth in the region
- Meeting the requirements of funding every kind of person or institution in the region (enterprises, private persons, municipalities, universities, etc.) can be funded.
- Financing local companies increases economic growth in the region
Further information
Website
Good practice owner
You can contact the good practice owner below for more detailed information.
Organisation
Investionsbank Sachsen-Anhalt
Germany
Sachsen-Anhalt
Contact