Equity loans: terms and conditions for the use of credits registered for economic and social develop

Equity loans: terms and conditions for the use of credits registered for economic and social develop

A decree published in the Official Gazette on October 31, 2020, specifies the use of the credits registered for the equity loans of the economic and social development fund, for very small and small businesses that have not found financing solutions with their banking partners or private financiers.


Eligible are the companies, associations or foundations with an economic activity, listed in the national directory of companies and their establishments, which meet the following criteria:

  • they must not have obtained a loan guaranteed by the State up to an amount sufficient to finance their operation ;
  • they must justify real prospects for the recovery of their business;
  • they must not be the subject of collective litigation;
  • they must be up to date with their tax and social security obligations or, if applicable, have obtained a plan for the settlement of the tax and social security liabilities.

SCIs are expressly excluded from the scheme. On the other hand, it is specified that companies that have become more profitable as a result of the adoption of a safeguard or recovery plan are eligible for the scheme.


Application for Funding

In order to formulate its request, the company refers the request to the Departmental Committee for the Examination of Business Financing Problems, which directs it to the service dedicated to loan applications, managed by the company Bpifrance Financement.


Amount and duration of the equity loan

The amount of the equity loan is limited to :

  • 20,000 euros for companies active in the agricultural sector, employing from 0 to 49 employees ;
  • 30,000 euros for companies active in the fisheries and aquaculture sector, employing between 0 and 49 employees;
  • 100,000 euros for companies employing from 0 to 49 employees and not active in the agriculture, fishing and aquaculture sectors.

It is specified that the loans are disbursed at a fixed rate that is at least equal to 350 basis points.

The financing covers investment needs and working capital requirements.

This loan has a term of 7 years and it admits a 12-month deferred payment of the principal from the disbursement.

For more information, please consult the document available here

Our experts are constantly monitoring regulatory changes providing support to businesses. Our articles are updated by midday on the basis of press releases and the publication of decrees by official bodies, which are deciphered by our experts. There may sometimes be a couple of hours delay between the official texts and our publication, the purpose of which is to provide you with preliminary answers to your questions.