The Brussels Guarantee Fund

Last modified:

Friday 28 July 2017

What is the Brussels Guarantee Fund?  

The Brussels Guarantee Fund is a regional public institution created in 1988.

Its aim is to facilitate the granting of professional credits in the Brussels-Capital Region by providing financial institutions, by means of the payment of a one-off contribution, with a substantial portion of the guarantees required from companies.

Specifically, if you do not have sufficient guarantees to offer your bank and the latter refuses to grant you the necessary credit for this reason, the Fund can replace these requirements and allow you to obtain the financing.

It is intended for:

  • Small and medium enterprises according to the European definition of SMEs..
  • And individuals, self-employed workers and non-for profit...
  • ...that are making investments in Brussels
  • .. and are active in all business sectors, with the notable exception of the public sector, hospitals and certain self-employed professions, such as notaries or bailiffs.

Basic principles

  1. The funds guarantee is suppletive; in other words, it can only intervene after the use of other sureties. The fund cannot confer its guarantee in the absence of other sureties.

  2. The guarantee only concerns capital, to the exclusion of interest, fees, etc.

  3. The guarantee always requires the bank to bear a portion of the credit risk. In addition, the fund only covers the bank up to a maximum of 80% of the credit.

The different guarantee categories

The pre-agreement

The entrepreneur makes his request directly to the fund to obtain an agreement in principle, valid for 4 months, for the granting of the credit guarantee. The latter may consult the bank(s) of its choice to obtain the necessary credit. To benefit from the guarantee, the bank must them confirm the pre-agreement with the fund.

Demand guarantee

The bank submits a demand guarantee file to the fund and acts as intermediary between its customer, the credit applicant and the Brussels Guarantee Fund, which is providing by the guarantee.

The  express guarantee, known as the crisis guarantee

This is a crisis measure offered to meet the financing needs of companies. Based on certain specific conditions, the respect of which is checked by the bank, the latter can directly and quickly mobilise the fund guarantee, without the former needing to submit a file.

Apart from the classic express guarantee, the green express guarantee is reserved for green activities/investments. As a result, it offers the most advantageous conditions.

A third express guarantee is the micro-finance guarantee.

Terms for the pre-agreement and the demand guarantee

Credits covered:

  • Professional credits for financing
  • property investments, tangible and intangible fixed assets for the recovery of all or part of a professional activity
  • the (re)constitution of working capital
  • the recovery of business capital or the purchase of shares
  • Financial leasing operations
  • Surety credits
  • The reimbursement of existing credits (restructuring of the balance sheet)
  • Credits linked to financing extraordinary events such as natural disasters

Maximum amount: €50,000 (over this amount: possible intervention from the Ministry)

Maximum duration:

  • 10 years to cover depreciable credits
  • 5 years to cover non-depreciable credits

Cost: the only cost is a one-off contribution (to be paid once in advance) of 0.75% (depreciable credit) or 0.90% (non-depreciable), multiplied by the amount to be covered and the number of years. If this relates to a company less than 4 years old, these rates are 0.5 and 0.7% respectively. This amount is to be distributed equally between the company and the bank.

Decision period: 15 days

Specific terms of express guarantees

Credits covered: the same as for the other two types, but

  • No reconstitution of working capital
  • No reimbursement of existing credit
  • No credit for extraordinary events

Maximum amount: €50,000 for the classic express guarantee, €250,000 for the green express guarantee.

Maximum duration:

  • 5 years for the classic express guarantee
  • 5 years for the green express guarantee, non-depreciable credits
  • 15 years for the green express guarantee, depreciable credits

Guarantee required: surety from shareholders for 50% of the guarantee from the fund

Decision period: 5 days

Receivability criteria

  1. The corrected equity for long-term debts must be at least 10%.
  2. The working capital must be positive.

These two conditions must be met after processing of the transaction.

You can find more information on the Brussels Guarantee Fund website (only available in Dutch or French)

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