The launch of a Mutual Guarantee System in Portugal aimed to create the conditions necessary to reduce the costs of financing companies, especially SMEs, as well as a better balance of their finance structure. In particular, the acquisition of guarantees, which allow them access to loans with suitable terms – easily adapted to their exploration cycles and to the types of investments these enterprises have to make in order to develop themselves.
The Mutual Guarantee System in Portugal arose from public initiative, by means of the IAPMEI, an institute that supports SMEs. In 1992, following what had already been carried out in other countries of the European Union where this financial support mechanism was already working, this organization decided to start studying the possibility of launching a pilot project in this area. The central idea was that it would be the charge of public entities to take the first step in promoting this initiative. The second step – the leadership and distribution of the project – would then be taken by the private sector, headed by the respective businessmen and enterprise associations, i.e. the ones who are interested in the benefits that such a System can render to its enterprises…
Therefore, a pilot society was created, the SPGM, whose main objective was to test the interest of this project in relation to the market. To do so, it built guarantee operations and other services aimed at SMEs, using frameworks similar to those of the future Mutual Guarantee Societies (MGSs). This society also had the mission of preparing a legal framework that would come to regulate the entire Mutual Guarantee sector in Portugal as well as the respective counterguarantee mechanism.
|Year of creation|
individual entities or association
|Type of scheme|
guarantee or counter-guarantee
|Mutual Guarantee Association|
guarantee or counter-guarantee or co-guarantee
i.e. fully mutual, funded by SMEs, banking associations, fully public, fully private, private-public, mixed models
Private / Public (in %)
|Private 19%, Public 81%|
of single guarantee entity or association: i.e. fund, development bank, development agency, cooperative or mutual societies, bank, foundation, association, limited company, etc.
of members of an association: i.e. fund, development bank, development agency, cooperative or mutual societies, bank, foundation, association, limited company, etc.
|Structure / Network|
i.e. central scheme with regional offices, central scheme only, association network
|MGS back office managed by SPGM (functions as a "holding" of the Portuguese Guarantee Scheme) + Independent MGS + Public Counter Guarantee (managed by SPGM)|
i.e. local, regional, national
i.e. agriculture, industry, crafts, retail, liberal professions, cooperatives, etc.
|Size of businesses supported|
i.e. large companies, SMEs, micro-enterprises, independent/self-employed
|SMEs, Micro-enterprises, Independent/Self-employed, Unemployed, university and post-graduation students|
i.e. mono-product banking licenses, financial intermediary statute, non-supervised. For associations, please state statute of members
|Profit / Non-profit oriented|
dividends to public shareholders are not considered as profit orientation
|Do you benefit from a counter-guarantee at local, regional or national level?|
Local level or Regional level or National level
|Local, Regional and National level - Fundo de Contragarantia Mútua|
|Are you/your members financial intermediary for EU-programmes?|
CIP/COSME or Structural funds or Progress or RSI/RSFF Horizon 2020
|CIP/COSME, Structural funds, Progress and RSI/RSFF Horizion 2020|
|Types of guarantee products provided by your organisation/your members||Loan default guarantees, Working capital loan guarantees, Bridge financing loan guarantees, Mezzanine financing guarantees, Leasing guarantees, Project guarantees, Export guarantees, Student loan guarantees|
|Other SME support instruments offered by your organisation/your members|
Subsidized loans or Mezzanine financing or Venture capital or Coaching or Mediation services
|Mezzanine financing, Coaching, Mediation services|
|Is the activity subject to state aid regulation?||Yes|
|Do you (your members) use..?|
De minimis or GBER or Regional guidelines or Notification
|Do you (your members) dispose of an internal rating/scoring system?||Yes|
|Do your guarantees provide deponderation (capital relief) for member banks subject to capital requirements (Basel agreement)?||Yes|
|Do you (your members) benefit of a public counter-guarantee that allows deponderation (capital relief)?||Yes|