After Flanders with its “Winwinlening”, Wallonia and its “Coup de Pouce” loan, Brussels offers, since October 15, 2020, the “Proxi Loans” which allow entrepreneurs from the Brussels-Capital Region to get affordable loans from private individuals.
This Proxi Loan allows private individuals who believe in the future of an entrepreneur to make up for a lack of financing. It aims to provide a short-term supply of equity capital and to gather citizens’ support around promising projects.
The Proxi loan is concluded between a loaner and a borrower, or through a funding vehicle. The parties have to sign a loan deed (a template is provided by the Brussels Guarantee Fund).
The Proxi loan is intended for companies located in the Brussels region that wish to booster their activities.
Until 31 December 2021, the borrower is allowed to borrow a maximum of € 300,000 (all Proxi loans combined), after this date, this amount will be capped at € 250,000.
The loaner can lend up to €75,000 per company per fiscal year (this cap will be reduced to €50,000 after December 31, 2021). The loaner will benefit from an annual tax credit of 4% of the amount loaned during the first three years and 2.5% for the following years. If the borrower is unable to repay (e.g. due to bankruptcy), the loaner is guaranteed to recover 30% of the amount loaned via a one-time tax credit.
This type of loan is regulated in terms of duration (five or eight years) and interest rate (minimum 0.875% and maximum 1.75%). It is subordinated to the borrower’s current and future debts. This subordination implies that repayment is conventionally subject to the prior payment of all other debts on the borrower’s balance sheet (the funds loaned being assimilated to quasi-equity capital for accounting purposes).
For more information on that subject, feel free to contact Virginie SCHOONHEYT esq. (firstname.lastname@example.org).
The Cairn Legal team.