The Guarantee Fund: what it is and who can benefit from it

It is a tool established by law 662/92 to facilitate access to financing for small and medium-sized enterprises and professionals who are unable to provide sufficient guarantees to credit institutions, through the granting of a public guarantee of up to 80% of the financed amount. The guarantee is an incentive made available by MiSe and also funded with European Union resources and managed by Mediocredito Centrale Spa.

It can only be activated against financing granted by banks, leasing companies and other financial intermediaries (affiliated with the Fund) in favor of businesses and professionals. It is important to emphasize that the Fund cannot intervene directly in the relationship between the client and the credit institutions; therefore, the economic and contractual conditions are left to the parties. The only constraint imposed by the Fund is the inability of banks to acquire further real, insurance or bank guarantees on the part of the financing guaranteed by the fund itself.
The Guarantee Fund covers up to a maximum of 80% of the amount of the financial operation and up to a maximum guaranteed amount per beneficiary of 2.5 million euros (a limit that refers to the guaranteed amount, while there is no maximum ceiling for the financing - usable for one or more operations, until the established ceiling is reached), without entering into the merits of the nature of the operation, which must only relate to business activity (financing of investments, working capital, liquidity, leasing, mini bonds, etc.); please keep in mind that the % of coverage depends on the purpose of the financing.

The Fund can intervene either by directly guaranteeing the financial operation (Direct Guarantee), or by counter-guaranteeing/reinsuring a guaranteeing entity (confidi or other financial intermediary) that guarantees the operation in the first instance (Counter-guarantee/Reinsurance). Obviously, this guarantee has a cost, which however is much more advantageous compared to a guarantee acquired on the market and depends on the size of the company and the type; in fact, the following are excluded from paying the one-off commission:
- operations for the anticipation of credits towards the Public Administration, operations referring to innovative start-ups or certified incubators or innovative SMEs and microcredit operations;
- final beneficiary entities with registered office and/or operational headquarters in the Southern Regions (Mezzogiorno);
- female-led enterprises;
- small enterprises in the supply chain of companies under extraordinary administration;
- micro, small and medium enterprises that have signed a network contract;
- social enterprises;
- road transport companies.
We also emphasize that in the case of requests relating to "Nuova Sabatini" operations and financial operations granted in favor of female-led enterprises, innovative start-ups and certified incubators, priority is recognized in the investigation and in the resolution of the Management Board.

As mentioned in the introduction, micro, small and medium-sized enterprises registered in the business register, consortia and professionals registered in professional orders can access it.
They are defined as:
a) "Medium enterprises": enterprises that, considering the existence of any associated and/or linked enterprises, have fewer than 250 employees and an annual turnover not exceeding 50 million euros or a total annual balance sheet not exceeding 43 million euros;
b) "Small enterprises": enterprises that, considering the existence of any associated and/o linked enterprises, have fewer than 50 employees and an annual turnover or a total annual balance sheet not exceeding 10 million euros;
c) "Micro-enterprises": enterprises that, considering the existence of any associated and/or linked enterprises, have fewer than 10 employees and an annual turnover or a total annual balance sheet not exceeding 2 million euros.
The subjects must be deemed capable of repaying the loan, therefore they must be considered sound from an economic and financial point of view. To allow for an impartial and objective evaluation, the rating portal (https://www.fondidigaranzia.it/servizi-online-per-le-imprese/portale-rating-per-le-imprese/) has been made available to private individuals, which allows for the advance evaluation of eligibility for the Fund and also the % of guarantee coverage.

The only excluded enterprises are those belonging to the automotive industry, shipbuilding, synthetic fibers, coal industry, steel industry and financial activities sectors.
In the transport sector, only companies that carry out road freight transport are eligible. Agricultural enterprises can only use the counter-guarantee by turning to a confidi that operates in the agricultural, agri-food and fishing sectors.
 

This post was created with the aim of focusing on the main points that characterize the guarantee fund, as the application is submitted by the company/professional through the financial intermediary to whom the financing request was made, who follows the entire procedure and takes care of providing the documents and sending them to Mediocredito Centrale.
It is important to emphasize how the Guarantee Fund for SMEs has been appreciated both by companies, which use it because it allows them easier access to credit, and by banks, which can rely on a state guarantee for compensation even in the event of the financed company's failure.