People from all over the world have recently—or some for quite some time—made Berlin their new home. They bring with them a great deal of entrepreneurial potential that must be harnessed. Together with the State of Berlin, we have been supporting refugees and non-EU nationals since June 2022 in establishing themselves as entrepreneurs in Berlin. We do this by using our guarantees to facilitate their access to viable and long-term financing solutions. While a temporary residence permit was often the reason a bank denied a loan, the only remaining obstacle now may be economic risk—which is deemed too high because the project is not considered promising enough. This is because, as part of our “BBBwelcome” guarantee program, we—together with the State of Berlin—assume the political risk of deportation. The banks bear only a residual risk of 10% of the loan amount if the reason for the loan default is deportation. Otherwise, the banks bear a residual risk of 20%, as usual.
We lobbied intensively for such a program with the Senate Department for Economics, Energy, and Public Enterprises and were ultimately able to get it off the ground quickly together. And we are very proud of that. Guarantees from guarantee banks are the most efficient support instrument for the state, since the guarantee banks also assume default risks. Specifically, this would mean, for example, that for a loan amount of 100,000 euros with an 80 percent guarantee from BürgschaftsBank Berlin (BBB): If the loan goes into default, the bank covers 20,000 euros and the BBB covers 80,000 euros, of which 64,000 euros is covered by the State of Berlin. If the reason for the loan default is deportation, the BBB pays 90,000 euros to the bank or savings bank. The BBB can provide default guarantees of up to 1.25 million euros.
This has made long-term financing possible for the business ventures of non-EU nationals and refugees—at least for now in Berlin. The “BBBwelcome” support program is open to everyone: From solo self-employed individuals and members of the liberal professions to small and medium-sized enterprises in which refugees or non-EU nationals are the principal shareholders—the key requirement is that the business is based in Berlin or that the financing project is implemented in Berlin. The only exception is housing construction companies. Entrepreneurs can approach us directly or go through their primary bank. We also see ourselves as a kind of “loan workshop,” meaning we structure the financing and then implement it in collaboration with the entrepreneur’s primary bank. The financing portal of the guarantee banks, “finanzierungsportal.ermoeglicher.de,” is becoming an increasingly popular first point of contact, where financing requests can be submitted around the clock, every day of the week. For which financing purposes is “BBBwelcome” an option? “BBBwelcome” can be used to finance working capital, machinery, production lines, vehicle fleets, business start-ups, business acquisitions, modernization and expansion projects, replacement investments, and expansion into new markets. Financing for renovations and restructuring is excluded. What type of financing is “on the horizon” for you or your business partners?
Please feel free to contact us to discuss this.
