PREMiere in Romania
The European Commission supports the establishment of the first NFI dedicated exclusively to social enterprises: AFIN, the Alternative Finance Institution
24 February 2021
The Foundation “Alături de Voi” România îm together with Patria Credit IFN SA and the European Federation of Ethical and Alternative Banks, are partnering to launch the first non-bank financial institution that will facilitate the financing of businesses with social impact in România - AFIN - Alternative Finance Institution in România dedicated to the social economy sector.
Brings together the expertise of three national and international partners in the field of social economy and investment supporting sustainable community development – the Foundation “Alături de Voi” România (ADV), Patria Credit IFN and the European Federation of Ethical and Alternative Banks (FEBEA). Within 18 months of project implementation, the three partners will set up the first non-bank financial institution specialized in supporting social impact investments and will start the first lending contracts.
“The idea of this NFI comes from the need that we ourselves had, as a social enterprise, to have access to financing for business development. Unfortunately, at the moment, Romania does not have any specialised instrument for lending to social enterprises and this affects their competitiveness and sustainability in the market. We decided it was time to get involved and create such an instrument and transfer our 13 years of expertise in social economy. But we can't do this alone, only together with partners with banking experience, people and companies with business experience and social enterprises willing to take advantage of this instrument. Good things are built as a team and we greatly appreciate that more than 30 private institutions have announced their intention to contribute to the establishment and development of this instrument. We hope that in the next few years we will expand the scope of NFI intervention in Moldova and Ukraine, where we are already working on the development of social entrepreneurship, said Angela Achiței, President of ADV Romania.
The aim of the project is to facilitate access to finance for social enterprises in Romania that have passed the start-up phase and need capital resources to progress. ”&In Patria Credit we incubate innovative financing models îable to create genuine economic and social impact îin rural areas and generate local community development. Our involvement in initiating AFIN, alongside partners with similar values and missions, gives us joy and energy, reminding us even of our beginnings, almost 20 years ago, when we started from an NGO project. We have funded several NGO and social business projects at home, but there is clearly a need for a dedicated institution to do this as a core business and with a business model optimally adapted to the segment. Today we are the oldest and most experienced microcredit institution in Romania and we want to contribute where our expertise adds value and creates measurable impact.” said Raluca Andreica, General Manager Patria Credit IFN. Through the European Social Fund, more than 2,400 social enterprises are currently being established in Romania which, at the moment, do not have access to any financing instrument that would allow them to scale and develop their business while increasing their social impact. This project represents a new stage in the development of the social economy in Romania and in the cross-border region of Romania and the Republic of Moldova - Ukraine. It is an essential mechanism that will put in place an integrated system of specialised assistance for the social economy.
”As Europe undergoes a major health crisis, it is essential to strengthen the links between actors promoting social, ethical and solidarity finance în Europe. By promoting knowledge exchange and developing common tools, FEBEA welcomes the collaboration with AFIN in the hope that it will lead to the emergence of a new player in the social business finance sector in Romania. In the coming years, the consequences of the pandemic will be felt at all levels of society and especially among the most vulnerable. Similar AFIN entities will make a key contribution to building a sustainable and inclusive society in Romania and Europe," said Daniel Sorrosal, Secretary General of FEBEA. The AFIN project is complementary to three other European projects that ADV Romania is implementing until 2023, through which more than 50 social enterprises will be created in Romania, the Republic of Moldova and Ukraine. It also ensures synergies with the European Commission's actions on economic recovery and the development of the social economy, the third economic sector, which represents 10% of the total number of enterprises in the European Union and accounts for 6% of the workforce.
*** About the Foundation “Alături de Voi” România / www.alaturidevoi.ro The Foundation „Alături de Voi” România (ADV) is a non-governmental organisation of social enterprise type, founded in February 2002. The mission of the foundation is the inclusion of people with disabilities and other vulnerable groups. ADV România has 13 years of experience in the field of social economy and has set up three social businesses in the meantime, being declared Social Entrepreneur of the Year 2016 in the EY Entrepreneur Of The Year global competition. About FEBEA - European Federation of Ethical and Alternative Banks / www.febea.org The European Federation of Ethical and Alternative Banks was founded in Brussels in 2001 and brings together 30 financial institutions from 15 European countries with a mission to develop ethical and socially responsible financing instruments. Together, these innovative and pioneering institutions promote the importance and urgency of developing ethical and solidarity-based financial models in the European economic and political space.
AFIN's mission is to create a platform for social impact investing.