Microcredit is a useful instrument for financing the requirements of those who are excluded from the banking system. In France, microcredit can provide a response to two types of need:

- financing of the creation or development of micro businesses, in particular in the case of a jobseeker creating a startup. This is “professional microcredit”;

- one-off help provided to people in difficulty, by supporting a specific project with a view to promoting professional insertion, access or a return to work: this is “social microcredit”, also known as personal microcredit, which requires social support from the lender during the phase when their application is being studied, as well as during the entire reimbursement period.

Microfinance has developed via the intervention of specialised associations. Banks such as Societe Generale are the natural partners of these associations, which act as both advisors and loan distributers.

Professional microcredit

In 2009, over 580,000 businesses were created in France. This surge since January 2009 has been due to the direct influence of France’s new simplified self-employment regime. 37% of these startups were the result of jobseekers creating their own business.

Societe Generale, banker and partner of ADIE

ADIE (Association pour le Droit à l’Initiative Economique, or association for the right to economic initiative) was created in 1989 by Maria Nowak by adapting developing countries’ microcredit principles to France. The association helps those excluded from the job market to make it easier for them to have access to loans to create their own business. ADIE has already financed over 60,000 startups, mainly created by people on benefit and by long-term jobseekers.

Societe Generale has supported ADIE’s action since 2006 by making refinancing credit lines available to it for its microcredit activity and by contributing to the financing of its support actions. This support concerns networks in mainland France, but also in the French West Indies, New Caledonia and French Polynesia.

Since the signing of the agreement in 2006, almost 8 million euros worth of loans have been paid out thanks to the budgets made available to ADIE by Societe Generale.

Startup loans distributed by Societe Generale

Societe Generale has had a market share of around 10% of the Very Small Business market for a number of years.

Accompanying business creators through a specialised network significantly increases their chance of success, depending on the support network (the 3-year national survival rate for startups is 66%). Societe Generale uses these networks (ADIE, but also CCI Entreprendre en France, France Initiative, etc.) and promotes them amongst its many startup customers.

Personal microcredit

The only bank in France to grant microloans to young people entering working life

Societe Generale is the only bank that distributes “Prêt Jeunes Avenir” loans for young people developed in partnership with the Caisse Nationale d'Allocations Familiales and the Caisse des Dépôts et Consignations.

Reserved for people aged between 18 and 24, it aims to finance expenses associated with a new job. These loans can be for sums of between 500 and 5,000 euros, and are interest free with no admin fees.

Since its launch at end-2007, Societe Generale has helped almost 2,000 young people entering working life benefit from such loans.

Social microcredit just around the corner

Societe Generale has just received the Caisse des Dépôts’ approval to distribute personal microcredit to people excluded from the banking system, because of their level of income or their job insecurity, in accordance with the terms of the social cohesion law.

These loans, which can be as high as 3,000 euros, will finance expenditure enabling people to have access to, remain in or return to working life or professional insertion projects.

Borrowers will benefit, when the loan application is examined and during the reimbursement period, from support from the associations with whom Societe Generale has created partnerships. This social support will ensure the success of these operations.

The first of these loans should be granted by Societe Generale in the coming weeks.