1. 1 A European Community Reinvestment Act Stimulating growth of micro-enterprises and social entrepreneurship? GECES 27 Novembre 2012

2. I – The CRA in the USA 1.1. In 1976, the HMDA (Home Mortage Data Act) made it compulsory for banks to give detailed account of their mortgages, including refusals: First transparency and statistics Demonstrate that in disadvantaged communities, more money is collected than is loaned out 1.2. Hence in 1977, following the HDMA, a Community Reinvestment Act was introduced. Bank obligation to draw up community statistics indicating the collection and reuse of savings, in the form of credit, by region and by borrower profile (a reporting obligation). Stastics analysed, audited, rated by inspectors and published. In the event of bad ratings, banks face the following risks: Risk to their reputation Refusal of merger applications Weaker position in public procurement tenders Legal action 2

3. The CRA in the USA 1.3. In the event of poor ratings, banks have to justify their practice and show that they provide credit, services and advice in an equitable manner in the community, and make proposals as to "Community Reinvestment". 1.4.In order to improve the collection/loan balance, the banks can either: Act directly via their existing trading network Act indirectly by creating subsidiaries, CDFI or partnerships with NGOs 1.5. Positive results after 35 years:  $1,400 billion of credit and services channelled towards ("problem"?) communities  60% via loans to micro-enterprises and SMEs  Average loan $40,000  6,000 social enterprises, NGOs and assocations received finance from the banks as a result of the CRA  2,000 social banks and social capital risk funds refinanced by the banks  $50 billion dollars injected into the communities each year 3

4. 2 – Benefits of a European CRA and its relationship with the Social Business Initiative (SBI) 4  Multiply credit, services and advice to micro- enterprises and social enterprises in Europe without implementing quotas or alteration of the fiscal framework, and without weakening prudential standards  Take action so that banks have a better understanding of their needs in order to better serve them, including through innovation.  Create new partnerships between the banking world and the social economy.

5. 3 – Commission proposals 5 1. Launch an official study of the conditions of transposition of the CRA in Europe, taking into consideration specific European characteristics and involving interested Member States (e.g. France). 2. Launch a call for proposals for five regional experiments in Europe, gathering information in the spirit of the CRA which will bring together the banks, associative actors, social entrepreneurs and the social economy. 3. On this basis, start working on the links which could be established between bank transparency/local reinvestment and the finance of: EIB, EIF ESF, ERDF