AFIN IFN S.A., our non-banking financial institution dedicated to supporting the social economy, has been highlighted as good practice in the Interreg Europe Policy Learning Platform, which is co-funded by the European Union. This recognition came at the proposal of the Regional Intermediate Body for European Human Capital Programs Bucharest-Ilfov Region (OIRBI), within the project "MICROFUTURE - Sustainable microfinancing for social inclusion"
AFIN IFN S.A. was presented as a model of good practice through the alternative financial solutions offered to social economy operators, but also through its integrated operational model developed in collaboration with the Social Finance Association (SFA). This model includes expert consulting and mentoring, a hybrid approach that can serve as inspiration for other Eastern European countries, such as the Republic of Moldova or Ukraine.
Potential to replicate the model in other states
The integrated model AFIN IFN S.A. & SFA has significant potential to be replicated, due to the fact that MICROFUTURE project partners have identified similar challenges in the sphere of social economies in other countries and have seen promising results in implementing this model. The scalable approach of AFIN IFN S.A. it is of interest to other Eastern European countries where social entrepreneurship is a viable solution to address economic and social challenges.
"AFIN stands out for two main reasons. First of all, it offers alternative financial solutions dedicated to the field of social economy. In Eastern Europe, such tools are rare and essential for impact-oriented startups or NGOs seeking non-grant funding. Second, the institution is distinguished by its integrated operating model, which includes consulting support. This hybrid model can be very inspiring for other regions in Europe", said Mart Veliste, representative of the Interreg Europe Policy Learning Platform. The entire database of good practice models on Interreg can be consulted here.
Remarkable results in a short time
Less than a year after the beginning of lending activity, AFIN IFN S.A. recorded notable results:
- Increasing the number of applications for obtaining a loan from legal entities with social impact, especially from startups in the acceleration and development phase.
- Financial support for NGOs that require cash flows for projects with non-reimbursable funding.
- Support for social entrepreneurs who want to initiate economic activities and generate income to continue their social mission in the community.
Success story
With an initial share capital of 245,000 euros, AFIN IFN S.A. began lending activity in May 2023. In the meantime, the institution operated a new capital increase of 95,000 euros and signed credit agreements with three local banks. Until the end of 2023, AFIN granted 20 loans to economic operators with social impact at the national level, totaling 280,000 euros. Among the credited entities, there are 11 social enterprises that were supported to move from the start-up phase to the acceleration phase and to maintain their status as a social enterprise or, as the case may be, insertion. Also, 7 NGOs received loans, which benefited from bridging loans to continue implementing their projects with non-reimbursable funding.
In total, 121 jobs were maintained, of which 17 were for people from vulnerable groups, including people with disabilities and young people who had left residential care.
Contact:
AFIN IFN S.A.
Email: contact@afin.org.ro
Website: www.afin.org.ro