Belgium

In Belgium, there is no specific regulatory framework for microcredit provision and non-bank lenders provide loans under the Banking and Consumer law. Belgian MFIs use different legal forms to offer microcredit, such as a social or credit cooperative. Thanks to the Companies and ASBL law, in effect since 2019, not-for-profit associations (ASBL) are also allowed to provide “commercial” services such as microcredit.

Non-bank lenders providing personal loans must have an agreement with the Financial Service and Management Authority (FSMA). No supervision is foreseen for non-bank lenders offering business microloans. In terms of data protection, non-bank lenders are not obliged to share client data with the credit bureau and do not have access to data from the credit bureau.

Non-bank lenders are allowed to disburse business and personal microloans without limit. Regarding business microloans, there is no interest rate cap. Personal microloans have a cap of about 18% per annum.

In Belgium, some national/regional level funds support entrepreneurship (although there is no specific focus on micro-entrepreneurs) through the use of guarantees and funds for on-lending (senior loans). However, the current context offers no incentives in the form of tax deductions for individuals that provide financial support to microcredit providers in the country.

The sector would benefit from initiatives aimed at enhancing awareness, recognition, and the establishment of automatic and formalized linkages between MFIs and private or public sector actors involved in entrepreneurship support. Potential measures include referring entrepreneurs who are denied loans by banks or public initiatives for business creation to MFIs. Additionally, access to public support is essential and could take various forms, such as guarantees, equity investments, affordable credit lines, and subsidies to facilitate the delivery of high-quality non-financial services.