A special State-guaranteed revolving fund for Small and Medium Enterprises was set up in Italy in the year 2000. The fund specifically addresses the many cases of women entrepreneurs who need credit to launch or develop their business

A State-guaranteed
fund for SMES in Italy

6 min read
foto Flickr/wfabry

Executive summary

A special State-guaranteed revolving fund for Small and Medium Enterprises was set up in Italy in the year 2000. In case of a request for a loan, it provides to female-owned or controlled companies guarantees that can cover as much as 80% of the loan and up to an amount of € 2.5 million. The fund specifically addresses the many cases of women entrepreneurs who need credit to launch or develop their business but do not benefit from assets to use as collaterals. During the 2000-2014 period, 13% of the guarantees were granted to women entrepreneurs and guarantees to women have grown exponentially from 37 granted in 2000 to 9.791 in 2013.

In-depth analysis

A special State-guaranteed revolving fund[1] for Small and Medium Enterprises (SMEs), set up in Italy in the year 2000 under the control of the Italian Ministry of Economic Development, continues to afford, among other things, more favourable lending conditions to women entrepreneurs. It provides guarantees to those SMEs that cannot offer enough security to obtain a standard commercial loan. Indeed, without the Fund, in many cases women who need loans to develop their business but, as occurs more frequently than for men, do not have landed or unmovable assets to use as collaterals, would be refused a loan.

For female-owned or controlled companies[2] the guarantee may cover as much as 80% of the loan up to an amount of € 2.5 million; no access commissions are due. In comparison, most other loans are guaranteed only up to 60%.

Start-ups as well as already established companies can apply for a guarantee to cover financial operations finalised to company activities, with the exclusion of exports, acquisition of means of transport and operations in the sectors of synthetic fibres, iron and steel, shipbuilding, coal and automotive.

The fund has been effectively functioning due to its governance structure, composed of a Managing Committee and a pool of five banks headed by Medio Credito Centrale, the so-called Private Manager, who manages the fund on behalf of the Ministry of Economic Development and analyses and processes the guarantee requests advanced, on behalf of the SMEs, by the banks or financial intermediaries that will grant the loans. On a weekly basis the Managing Committee, chaired by the Ministry of Economic Development, decides on the provision of guarantees. The other members of the Committee are representatives from the Ministry of Economy and Finance, the Ministry of Agriculture, the Ministry of Transport, the Italian Bankers’ Association and several SME associations.

A special section of the fund is dedicated to helping women entrepreneurs: it was created in early 2014[3] by the Equal Opportunities Department, with an endowment of twenty million Euro matching other resources of ten million each, from the Ministry of Economic Development and the Equal Opportunities Department. To speed up the guarantee process, eligible women entrepreneurs can now request a pre-authorised guarantee from the Private Manager, which they can then use to obtain a loan.

The fund covers the banks and financial intermediaries’ loan exposure up to a maximum of €2.5 million. In 2013, 479 lenders were involved: 350 banks, 10 leasing societies and 119 mutual guarantee societies. The default rate is as low as 2%.

Information on the fund operation is distributed throughout Italy mainly through the SMEs sector associations, the Italian confederation of industries (Confindustria) and the Equal Opportunities Department.

During the 2000-2014 period, 13% of the guarantees were granted to women entrepreneurs. Guarantees to women have grown exponentially from 37 granted in 2000 to 9.791 in 2013. In the first semester of 2014 alone, 5.309 guarantees were issued. Interestingly, the economic and financial crisis has not diminished stakeholders’ interest in the mechanism: to the contrary, the guarantees more than doubled from 2009 to 2010, jumping from 2.972 to 6.468.

Chart 6 - Guarantees granted to women entrepreneurs in the 2000- 2014 period

* January to June 2014

The success of the fund rests above all in the continuing political will of Italian governments, from 1996 until today, to provide, develop and maintain the necessary public funds for the guarantees in support of SMEs. In addition, the recognition of the specific financial needs of women entrepreneurs is particularly beneficial for those women who cannot rely on unmovable assets to use as guarantees and can be hindered for that reason alone from launching a business or developing an existing one. The third success factor lies in the win-win situation created: the guarantee substantially modifies the relationships between lender and lendee, inasmuch as the lender has a keen interest to grant a loan to a viable entrepreneur who has a security set-up by the state while the lendee benefits from a guarantee that she/he would not otherwise have obtained at good conditions. The fourth success factor specifically relates to women’s difficulty in obtaining credit, by granting them the possibility to obtain a pre-authorised guarantee. Women that can demonstrate to their bank to have a state-backed guarantee are in a better position to negotiate and obtain a loan at satisfactory conditions. Finally, the carefully balanced selection of public and private sectors decision-makers from state, relevant credit institutions and SMEs associations as well as their commitment to meet on a regular basis is another concrete success factor.

In the whole process, the identification of women entrepreneurs as a specific group to support was particularly relevant for the development of women’s entrepreneurship in Italy.

The following considerations should be made if the measure is to be replicated in other countries:

  • Despite its growth, the fund remains unknown to the public-at-large. More widespread advertisements campaigns, particularly in the media would certainly help to raise awareness among entrepreneurs or would-be entrepreneurs.
  • Annual reports at the highest level, ideally to Parliament, should be mandatory on the costs and benefits of the measure. This would have two advantages: to bring to the fore the measure with a public debate and to evaluate its success.
  • Statistics should be provided on the impact of the measure to the creation and development of SMEs in Italy in general and to women entrepreneurship in particular.

Concluding remarks

In this analysis a few considerations need to be made:

When the objective of the government is included within a larger measure that applies and benefits to all SMEs as seen in the state-guaranteed fund in Italy, different governments may continue to implement the measure without particular stamina as the over-arching objective is the protection of the SME sector and the special conditions for women entrepreneurs are only a part of the overall policy. In this case governments did not wish to address the societal change underlying gender-related measures.

Enacting laws is not enough, controlling, assessing and reporting on the impact of measures is essential to their success and to the implementation of future projects and the measure would benefit from better communication and evaluation.


[1]Law 662/96 (art. 2, 100, a) operational from 2000

[2]Law 215/1992, on female entrepreneurship, Article 2, 1, a), defines female SMEs as either cooperative companies or partnerships that are composed of at least 60% of women, corporations with two-thirds of their shares and management in women’s hands, or sole proprietorship companies managed by women in craftsmanship, agriculture, tourism, commerce and services.

[3] Decree 145/2013 (the so-called “Piano Destinazione Italia”) converted into Law 9/2014 (art.2, 1bis), attributed the funds to the Equal Opportunities Department