Microcredit was introduced in the Third World decades ago and has successfully established itself in small businesses. There governments had recognized early on that small businesses need government support because they were no longer funded by banks.
First and foremost, smallholders were financed with the seed so they could farm. These initial projects were very successful and therefore small entrepreneurs, the self-employed, craftsmen and start-up founders were also funded with microcredit.
In Europe, and especially in Germany, it had long been set on the house bank principle. Thus, a government loan must be financed through a bank that is willing to share some of the risk. And if a house bank refuses a loan, then self-employed and craftsmen often have no access to a loan.
In microcredit, this has been made easier. The microcredit can be applied for for self-employed, artisans and entrepreneurs without a bank. The requirements for microcredit are also much lower than for other government loans. For example, self-employed and craftsmen can apply for a microcredit that already has a private credit entry. It is similar with the collateral. Here, small valuables, car motorcycle or jewelry can be offered. If there is no collateral then a guarantee can be accepted.
The microcredit is extended to a maximum of 36 months and is repayable in monthly installments with interest and repayment as annuity loans. The licenses for the credit are in the upper range at 8.59%. But with a loan amount of 10,000 € this is not particularly significant. Many self-employed and craftsmen are often happy to even get a loan. For a loan of 10,000 euros, the monthly installment is 327 €.
The self-employed and craftsmen should only apply for the microcredit if they do not get a cheaper Intrasavings loan. Although microcredit is subsidized by the European Social Fund, interest rates are still relatively high at 8.56% (8.90%). Although a few percentage points hardly noticeable at a relatively small sum. Subsequent installments were calculated with a maturity of 3 years.
|2,000 €||65.33 €|
|3,000 €||97,99 €|
|4,000 €||130.65 €|
|5,000 €||163.32 €|
|6,000 €||195.98 €|
|7,000 €||€ 228.64|
|8,000 €||261.31 €|
|9,000 €||293.97 €|
|10,000 €||€ 326.63|