PROJET "CASH ON START"
About this good practice
National Association for Support of Entrepreneurship in Końskie (KSWP) started a project "Cash on Start" which targets unemployed and inactive citizens of Mazowieckie Region in Poland. It offers loans for entrepreneurial activity, with a wide range of purposes such as investment capital, turnover, as well as current operational costs, extension or modernization of production and intangible assets related to the project.
The project has an initial implementation stage consisting of assistance, consultancy and support to entrepreneurs before distributing the loan. There is also a predisposition study of one hour for each beneficiary, furthermore, they have a personalized 4 hour coaching to help write their business plan. After the loan is granted, the personalized training continues and the applicant can select the area of interest between marketing, economics and taxes. These programmes are conducted in groups of 5 or more beneficiaries.
In terms of financial support, the maximum loan amount is PLN 50,000 (approx. EUR 11,700) with an interest rate of 0,5 % with no further fees or commissions. The repayment period is up to 60 months. The main requirements to access the program are to present the unemployment or inactive statement given by the government and to be a resident of the Mazowieckie Province aged between 18 - 64. The target audience is rural and urban population, the unemployed, people on welfare, disabled and people excluded from the mainstream financial services.
Resources needed
The investment period was between 2013-2015. The total budget of PLN 5,873,030 (with 85% coming from ESF and 15% from national funding) was split between the investment fund (PLN 5,679,060 including management costs and fees up to a specified ceiling) and non-financial suport services (PLN 193,970).
Evidence of success
After the end of the investment period (December 2015), the managing authority and intermediate body assessed the achievements and decided to renew the project. The total amount of loans provided from the beginning in 2013 until the end of 2017 has already reached PLN 9,000,000 (approx. EUR 2,120,000) and the number of loans reached 210. This project is a successful example of cooperation between national and regional public/private institutions in the use of ESF funds to offer microloans.
Potential for learning or transfer
KSWP focuses on adopting a customer oriented the point of view. This helps to better accompany the entrepreneurs with their needs. It also offers transitional financial support to help the entrepreneurs smooth their path from unemployed to employment. The adoption of financial instruments as a way to channel structural and national funds for microfinance is a more efficient and sustainable alternative than the traditional grant-based financing. Due to the fact that the product was well-tailored the access to microfinance has been progressively improved thanks to the efficient management of the funds and the additional non-financial support provided to the unemployed. The promotion of the financial instruments to the final beneficiaries is key for the success of the project. The financial instrument was marketed to potential final recipients by KSWP, who, apart from launching a website, held a series of meetings. The instrument was advertised at job fairs, in local newspaper, posters.
Further information
Website
Good practice owner
You can contact the good practice owner below for more detailed information.
National Association for Support of Entrepreneurship in Końskie