During the celebration of the Eurofi conference held in Nice (France), Commissioner Hübner announced the launch of JASMINE, a new facility developed in cooperation with the European Investment Bank, seeking to provide financial and other assistance to support the development of micro-finance institutions in the Member States as credible financial intermediaries capable of supporting those wishing to establish or develop a micro-business or to enter self-employment.

The original feature of JASMINE (Joint Action to Support Micro-finance Institutions in Europe) is that it brings together several EU Institutions (the Commission, the EIB, Parliament), public and private banks, the EUROFI network and donors. The project is due to start in early 2009 with a pilot phase that should last for three years.

Launch aid includes some 40-45 million euros to be initially made available from cohesion policy resources, with additional contributions from the European Investment Bank (EIB) and European Investment Fund (EIF). The new facility will be managed within the EIF and will contribute to promoting best practice in the micro-finance field, and improving the capacity of the micro-finance institutions. Compliance with agreed standards of good practice will be recognised with the award of a quality label.

JASMINE initiative will involve two main aspects:

• Providing for the provision of technical assistance to micro-finance institutions (MFIs) to help them to become credible financial intermediaries and obtain capital more easily. The "JASMINE" unit to be created within the European Investment Fund (EIF) will be responsible for vetting the business plans of applicant MFIs and helping them to achieve a high level of quality as regards their governance, financial management and commercial policy. The aim is to motivate these institutions to adopt good practices so that they can be awarded quality labels. JASMINE will also help to create training courses and publicity campaigns on the European micro-finance initiative for the Member States, the regions, the banks and micro-finance institutions.
• Finance operations by the most promising non-bank institutions so that they can grant more loans to project promoters. The JASMINE unit will examine the viability of applications and will make proposals concerning the cofinancing of these operations by the EIB and private partners.

JASMINE is one of the actions announced in the Communication on the development of micro-finance in Europe adopted by the European Commission in November 2007. It complements the JEREMIE initiative launched jointly by the European Commission and the EIB in 2006, which allows the Member States and regions of the EU to transform part of their Structural Fund allocations into financial products designed specifically for small and medium-sized enterprises.

According to estimates based on Eurostat data, the potential demand for micro-finance in the EU could be for more than 700,000 new loans, representing a total of some 6.3 billion euros in the short term. People excluded from traditional financial services are the main users of this form of micro-finance. New providers therefore need to be found: micro-finance institutions are good intermediaries but they lack capital.