What is a PCE (Prêt Création d’Entreprise) in France

By Valérie Aston on 9 June 2009 · Viewed 5224 times · Questions

As France is hit by recession it has become more difficult to borrow from banks to fund the starting up of a business. Banks try to limit their risk when investing in new businesses. However there are several schemes available which will help you reduce the amount you need to ask for as well as satisfy the bank’s desire to lower its risk. These schemes range from interest free loans, guarantees and exonerations that should hopefully make the difference in securing your investment. The most succesful scheme to help you secure your investment being the Prêt Création Entreprises (PCE).

If your overall investment is below 45,000 euros your bank manager will likely mention Prêt Création Entreprises (PCE). This small business loan, ranging between 2,000 euros to 7,000 euros, is issued by OSEO, the national banking organisation, and generates a guarantee of 70% on your main business loan.

How does it work? The PCE has to be associated with a business loan from the bank of at least twice its amount – so a PCE loan of 7,000 euros requires a business loan from the bank of at least 14,000 euros. OSEO issues a guarantee on your bank business loan and commits to reimbursing this loan to your bank if your business came into administration or receivership. The interest on the PCE varies on a monthly basis and was 4.67% at the beginning of June.

Valerie Lemiere: Start Business in France

About the author: Valérie Aston

I've been helping people who want to start or already have a small business set up in France since 2009. After graduating from a Master of Business Administration (MBA) degree, I worked as a senior marketing consultant in the UK and France for various International companies. I worked as a conseillère en création d'entreprises (senior business advisor) for BGE here in France and run this independent business on a daily basis.