JEREMIE: program for small SME-s

One quarter of Hungarian SME-s are capable of rapid growth, even if they are located in backward regions. Recognising the importance of SME-s and their difficulties in finding access to financing, the European Commission, the European Investment Bank and the European Investment Fund launched their Joint European Resources for Micro to Medium Enterprises, JEREMIE program in 2007. 80 per cent of Hungarian SME-s operate without access to external financing, while this proportion is only 15-20 per cent in developed countries. This calls for further measures to facilitate access for SME-s to financing. According to a recent survey, 105,000 Hungarian SME-s are expected to gain access to external financing in the near future. The government intends to introduce various forms of repayable subsidies linked to the JEREMIE program for SME-s, which will help them gain access to external financing by micro financing, providing guarantees and development of the capital market. In this way, the HUF 175 billion available from domestic and EU sources in the next seven years will indirectly allow sources amounting to HUF 2,000 billion to be mobilised. Money is to be transferred to a holding fund which is intended to help SME-s gain access to financing through intermediaries like banks and venture capital funds. These will be able to join the program at their discretion and provide financing and guarantees for SME-s in accordance with guidelines defined by the supervisory authority. Sources repaid to the fund will be used again for financing SME-s in order to ensure sustainable economic development.