Good news regarding loans for the unemployed. The European Union Employment and the Social Affairs Ministry have agreed to set up a program that would provide loans for unemployed people who would like to start their own business and do not have good enough credit on their own. The initial fund would provide 136 million dollars for micro loans to entrepreneurs and is expected to leverage more than 500 million with cooperation from the European Investment Bank Group.

The newly named European MicroFinance Facility will begin lending up to 25,000 euros to small business and micro businesses as well as unemployed people who would like to become self employed but have exhausted all other means of lending. The fund will lend to businesses with fewer than 10 employees and is expected to provide around 45,000 loans over the next 8 years. László Andor, EU Commissioner for Employment and Social Affairs and Inclusion stated, “It will increase the supply and accessibility of micro loans so vulnerable groups find a way out of unemployment. It will also boost entrepreneurship and the social economy in Europe. We expect the facility to provide small loans to around 45,00 budding entrepreneurs over the next eight years.”

Efforts began on June 3rd, 2009 , when the European Council proposed a shared commitment for employment that highlighted three priorities: maintaining employment and promoting mobility; upgrading skills and matching labor market needs;  and increasing access to employment.

Considering that 91% of all European businesses employ ten or fewer employees, the program looks to be a very successful one. Although the exact terms of the loans have yet to be spelled out, they are expected to be fairly standardized.

Although the United States  does not technically have something aimed directly at loans for the unemployed, we still have the unemployment extensions. After these are exhausted, other forms of financial assistance may be required.