Blog: Euro 120 million for creative sector - Hoofdinhoud

Creativity works! Recent studies have shown that Europe's cultural and creative industries have successfully managed the economic crisis. They employ 7 million people and account for 4.2% of European GDP. Our cultural and creative industries are packed with talent working in festivals, music and literature; in architecture, archives, libraries and museums; with artistic crafts, cultural heritage and design; in performing arts, publishing, radio and the visual arts.

With such a wealth of talent and potential, imagine what these creators could do if they had easier access to financing for their projects!

However, since they are operating with intangible assets and may lack collateral, or they are in a small market, with uncertain demand and a general lack of awareness of the sector's potential, financial intermediaries are often reluctant to extend them credit. If nothing is done, the financing gap in the cultural and creative sectors could amount to more than €1 billion per year.

The EU is in the position to step in and fill this financing gap so that these sectors can scale up and grow. Today, I am happy to announce the launch of the Creative Europe Cultural and Creative Sector’s Guarantee Facility, operated by the European Investment Fund on behalf of the European Commission. This new €121 million guarantee mechanism will help thousands of SMEs to access more than €600 million worth of bank loans by 2022.

The facility has its legal basis in the Creative Europe programme. The EIF will provide guarantees and counter-guarantees, free of charge, to commercial/retail banks, promotional banks and other financial intermediaries to offer debt finance to entrepreneurs in the cultural and creative arena. It will also offer these financial intermediaries free training so they can better understand the functioning and needs of the cultural and creative sectors. This will both increase funding opportunities for the creative sector and encourage more investment in creativity, one of the fastest-growing sectors of our economy.

Improving access to finance is a major element of my work to ensure that the creative sector, and in particular smaller businesses, can thrive in the digital era. As part of the Digital Single Market strategy we are proposing measures to boost these industries and improve the circulation of content across borders. Our efforts will have a much greater impact, and an even bigger benefit for our broader economy, if creative projects can grow due to a better investment climate.

A call for tender will be issued in the coming weeks to allow banks and other financial intermediaries to enter the scheme. Once a bank or other financial intermediary enters into an agreement with the European Investment Fund, it will then be able to offer loans to SMEs. I expect European SMEs to benefit from it as early as of the end of this year.

In the meantime, you can find out more about the guarantee facility here.