The Commission has updated the European Code of Good Conduct for Microcredit to reflect the changing market realities and capture the wide diversity of providers within the microfinance sector in Europe. It will enter into force on 1 January 2021.

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The Code update is the result of a consultation in 2019 with key stakeholders, including practitioners, the European microfinance networks (EMN, MFC), banks, EU institutions and experts, drawing on lessons learned from a pilot phase that ran between 2013 and 2017. The Code Steering Group, led by the European Commission, formally adopted the updated Code in October 2019. This updated Code has now been published.

The objective of the Code update was to fine-tune the existing clauses in the Code, where appropriate. Firstly, some parts of the Code were amended to better reflect evolving market realities, including best practices and more realistic expectations of providers. Secondly, amendments were required to ensure that the Code took into account the diversity of European microfinance institutions in terms of size, legal structures and national regulatory frameworks. 

The updated Code will enter fully into force on 1 January 2021. However, microfinance institutions that submit a request for a Code evaluation from the date of the publication (30 June 2020) onwards will be evaluated on the basis of the updated Code, even if they had signed up to the previous version of the Code.

Microfinance institutions that have already submitted a Code evaluation request, but have not yet been evaluated, may choose to be evaluated either on the basis of the updated or the previous Code.

Previously awarded certificates of compliance with the Code for microfinance institutions remain valid as indicated at the time of the award until their expiry.

About the European Code of Good Conduct for Microcredit Provision

The European Code of Good Conduct for Microcredit Provision was established following the adoption of the Communication on microcredit, by the European Commission, in November 2007. It defines a unified set of standards for the microfinance sector in Europe. The Code serves as a self-regulation tool and a quality label for microfinance institutions committed to ethical finance. It targets microfinance institutions that provide business loans of up to €25,000 to micro-entrepreneurs or self-employed persons.

The Code was developed based on recognised best practices in the sector in close consultation with stakeholders. Signing up to or endorsing the Code is a pre-condition for accessing EU funding for microfinance under the EU Programme for Employment and Social Innovation (EaSI).

View more information about the Code and the certification process.