Thirty-five years in brief
Hungary once had internationally recognised, functioning social-purpose microfinance. It was not professional failure but a botched institutional reorganisation in 2000, left without a statutory basis ever since, that brought it to its present state – and the path to settlement was mapped out by the state administration itself in 2004.
Sources: HSCF Comprehensive Study (August 2026), Chapters III–V; “Thirty-five years in brief” historical one-pager (v0, draft); Annex 2 of the explanatory paper (20 October 2026). Beyond stating the facts, this page offers no assessment of the court proceedings; no court has decided the question of ownership.
Where we stand in October 2026
The network has had no active lending programme since 2016, but it awaits launch with documented readiness: a public-benefit coordinator, a complete policy framework, working technology, an approved EU guarantee and two draft Acts ready for submission. Click the figures for their sources.
The coordinator
HSCF (MFKA – Hungarian Sustainability Centre Foundation): founded in 2023, a public-benefit foundation since 16 October 2025, consortium leader of the Hungarian Microfinance Network (HMN) and the institutional successor of the Székesfehérvár RVA, as documented in its deeds. It may already conduct non-profit microlending outside the scope of the Credit Institutions Act (Hpt.).
The network
Of the county and Budapest enterprise development foundations, 10–12 are active today; at launch, around ten accredited Microcredit Points will run the local client journey. Their shared platform is Credinfo, the credit information and loan management system, which according to the network is in use at every county foundation and at least twenty financial enterprises.
Readiness
A policy framework of thirty policies, aligned with the European Code of Good Conduct for Microcredit Provision (CoGC) and renewed in August 2026; the Code self-assessment shows 87% weighted compliance, and the on-site evaluation is under way with the involvement of MicroFinanza Rating. HSCF's own book today is a run-off legacy portfolio of six loans – the first disbursement under the new programme depends on the decisions.
Sources: the network's data submission of September 2026; CoGC self-assessment (27 August 2026); Credinfo portfolio queries (MicPro, 30 June 2026); points 1.3 and 3.1 of the explanatory paper. The historical portfolio indicators relate to collateralised lending and are therefore lower bounds, not forecasts, for the new collateral-free products.
A rung, not a product
Social-purpose microcredit is not a financial-market product but a social policy instrument: it operates on public funds, with an expectation of social return, and by definition serves those whom the market does not. Crowding out is therefore excluded by definition, and the bank is not a competitor but the next rung of the financing chain.
The financing ladder – click the rungs
The logic of a financial-market product
- yardstick: financial return, portfolio quality
- filter: real-estate collateral and credit history
- regulation: credit-institution (depositor-protection) logic
- interest subsidy up front, regardless of performance
- because of the unit cost of small loans, serving this segment does not pay
The logic of social-purpose microcredit
- yardstick: public cost per financed enterprise and per job
- filter: viability instead of assets – what is not viable gets no loan
- regulation: dedicated statutory framework, public task (SGEI), CoGC client protection
- benefit granted afterwards, for proven performance – none at all in case of non-performance
- non-profit form as an institutional guarantee; the loan and the support are one service
Hub & Spoke
Centralised infrastructure, decentralised client relationships. HSCF is the “hub”: fund owner, lender, contractual partner of the EIF, operator of the policies and of Credinfo. The Microcredit Points (county foundations) run the entire local client journey – information, pre-screening, site visit, credit assessment proposal, monthly support – but take no lending decisions. Sales Points (accountants, chambers) widen the reach.
Two-programme structure
The guaranteed loan is a complete loan in its own right, containing no non-repayable element. The performance-linked capital takeover is made from a national programme that is legally and financially separate, afterwards, for proven performance: at 60/70/80% of the term, the programme pays off the outstanding principal of an enterprise that has repaid without arrears, completed the support, and is operating and paying taxes – the loan closes with full repayment, and no guarantee call arises.
Mandatory business development services (BDS)
A three-layer system for every client: Layer A – a named coach, monthly online micro-report, quarterly consultation, early warning system; Layer B – advisory vouchers (B1 basic level HUF 300,000 (≈ EUR 750) + 2% of the loan, up to HUF 700,000 (≈ EUR 1,750); B1-M rescue intervention; B2 enhanced level HUF 1.5–3 M (≈ EUR 3,750–7,500)); Layer C – networking. The client chooses the provider from an open register, and the programme pays the provider directly. Planned intensity: ~16% of the loan volume.
Funding structure – four elements that do not substitute for one another (click)
International co-financing: at the European Microfinance Network's conference in October 2026, the CEB (Council of Europe Development Bank) and Inpulse signalled their openness to providing additional funding, provided the domestic base capital is in place. The domestic conditional grant is therefore the core on which EU and international funding can be built.
Three life situations, one shared DNA
Three flagship, EIF-guaranteed products for the most excluded groups – generational entry, second chance, return from abroad – and one base product (MFKA Classic™) for the whole micro-enterprise segment, outside the guarantee. The three flagship products share: a twelve-year term, a fixed interest rate, real-estate collateral excluded, and the majority owner's suretyship as the only legal security. All products share: a single fee (HUF 10,000 + VAT, ≈ EUR 25); refinancing of existing loans is excluded; AI-assisted pre-screening, but every lending decision is taken by a human.
Loan lifecycle calculator
Straight-line principal repayment, with interest charged on the outstanding principal at any time (planned repayment method). Indicative calculation, not an offer.
| Parameter | Start30™ | Start30+™ | Hazatérő™ (Returnee) | MFKA Classic™ |
|---|---|---|---|---|
| Target group | first-time founders under 30 | first-time founders over 30, restarters, career changers | returnees who have worked abroad for at least 3 years | the whole micro-enterprise segment excluded from bank finance |
| Loan amount | HUF 1–5 M (≈ EUR 2,500–12,500) (tier 1); max. HUF 19.9 M (≈ EUR 50,000) (tier 2, conditional) | max. HUF 15 M (≈ EUR 37,500) | max. HUF 19.9 M | HUF 1–19.9 M |
| Term | 144 months | 144 months | 144 months | 60–120 months (planning range) |
| Interest-free grace period | 24 months | 12 months | 6 months | none (up to 6 months technical) |
| Interest thereafter (p.a., fixed) | 3.0% | 3.5% | 4.0% | cost-of-funds based, 0–5% range, target ≤ 4% |
| Capital takeover review | month 87 (60%) – outstanding principal ~48% | month 101 (70%) – ~33% | month 116 (80%) – ~20% | none |
| Mandatory business development | yes (foundation training + 24 months of support) | yes, with restarter and digitalisation modules | yes, with job and tax-residence conditions | basic-level support |
| Guarantee · security | EIF InvestEU portfolio guarantee · majority owner's suretyship; real-estate collateral excluded | outside the guarantee (from own funds) · mortgage on real estate + owner's suretyship | ||
Source: FJMP product palette description v0.3 (8 August 2026), EIF product family description v3.3 and point 3.2 of the explanatory paper (20 October 2026) – draft, does not constitute an offer. Product names since 10 August 2026: Start30™ (formerly Junior Start), Start30+™ (formerly Senior Start). The supplementary, collateralised Green and Green Community line (120 months, without guarantee) is a developed concept. The outstanding principal ratios are indicative values calculated with straight-line principal repayment; the review can be brought forward by faster repayment, to no earlier than the midpoint of the term.
Ramp-up and funding needs
The guaranteed pillar fills the EU guarantee ceiling over three years with around 465 loans and HUF 4 bn (≈ EUR 10 M) of disbursements; the full programme, with the Classic base product, adds a further 460–630 loans per year. Every figure is a planning assumption (October 2026, planning rate of 400 HUF/EUR), not a commitment.
Ramp-up path
What it costs – the domestic funding
| Item | Order of magnitude | Timing |
|---|---|---|
| Full programme – revolving capital | ~HUF 40 bn (≈ EUR 100 M) | in instalments: in 2027 the guaranteed pillar's capital and operations + the Classic start-up ceiling; the rest in 2028–2030 |
| Stepped minimum – guaranteed pillar only | ~HUF 4 bn capital | 2027: HUF 4.7 bn (≈ EUR 11.75 M) (4.0 capital + ~0.7 operations), or aligned with the ramp-up: ~HUF 3.0 bn in 2027 and ~HUF 2.4 bn in 2028 |
| Operations and network support | year 1: HUF 0.62–0.86 bn (≈ EUR 1.55–2.15 M); years 2–3: HUF 0.53–0.78 bn/year | ~10 Microcredit Points, central staff, training, audit, IT; from the first quarter |
| Business development services (BDS) | ~16% of the loan volume (guaranteed pillar ~HUF 0.65 bn ≈ EUR 1.6 M; full programme ~HUF 5 bn ≈ EUR 12.5 M) | separate ceiling, from national funds |
| Capital takeover (national programme) | theoretical upper limit ~HUF 0.8–1.9 bn (≈ EUR 2–4.75 M) for the guaranteed vintage | between 2033 and 2041, afterwards, in proportion to performance |
Source: Chapter 6 and the funding sheet of the explanatory paper (20 October 2026); variants A–F of the programme planner v0.4. The lending capital is a revolving fund: over a 15-year horizon the model assumes a multiplier of 2.2.
The long-term path
The base path of the Comprehensive Study – assuming renewal or expansion of the guarantee ceiling – shows 6,872 financed micro-enterprises and an estimated 6,700 jobs over fifteen years, at a public cost of HUF 8.7 M (≈ EUR 21,750) per enterprise and HUF 9.0 M (≈ EUR 22,500) per job. The model prudentially assumes a 7% annual default rate; the programme deliberately accepts losses and is not budget-neutral – this is a planned public cost, not a flaw.
What we get for it
The measure of success is the share of clients handed over to market finance (graduation) and the public cost per unit of social outcome: what a financed enterprise, a sustained job and a taxpayer status each cost. Impact is measured by a sixteen-indicator, control-group plan (SEIMP) with public reporting – 2026 is the baseline year.
No lending without domestic capital
The EIF allocates the guaranteed volume in tranches, at the pace of utilisation: without domestic lending capital there is no disbursement, and without disbursement there is no next tranche. Without funding, the approved guarantee and three years of financing for around 465 enterprises would be lost. The programme planner (interactive HTML) shows the paths in six variants: HUF 4 bn (≈ EUR 10 M) in one sum or in two instalments, EU-capital and stress paths, HUF 40 bn (≈ EUR 100 M), and HUF 25 bn (≈ EUR 62.5 M) + international funding.
The guarantee – and what it cannot be expected to do
On 21 September 2026 the EIF approved, and on 15 October 2026 confirmed in writing, the programme's portfolio guarantee under the InvestEU social window (“InvestEU Microfinance, Social and Skills Guarantee Product – Microfinance portfolio”). The guarantee shares part of the credit risk; it does not replace lending capital, and it applies to loans actually disbursed. It does not draw on the state counter-guarantee ceiling.
What do the 80% and the 10% mean? – try it out
The guarantee covers 80% of the loss on each loan (guarantee rate), but total payouts may not exceed 10% of the guaranteed portfolio (cap rate). Set the portfolio's loss over the full term:
The approved main terms
Source: the EIF's written notification (15 October 2026; exchange-rate footnote 366.71 HUF/EUR, 1 September 2026). The final terms will be laid down in the guarantee agreement, whose signature is expected in the coming weeks. The start of lending requires domestic lending capital and the announcement of the programme.
Why the guarantee is not funding – the most common misunderstanding
The portfolio guarantee shares part of the credit risk; it does not replace a single forint of lending capital. Anyone who reads the guarantee agreement as fund-raising misjudges the programme's funding side by an order of magnitude. The lending capital comes from the domestic funding structure (settled earmarked assets, JEREMIE reflows, conditional grant); to this the EIF adds risk cover and an EU quality certification. Its advantage is that it is a centrally managed EU instrument: it does not depend on the domestic operational programming cycles and can therefore be obtained in parallel with the settlement of the legacy public funds.
What is the difference between EUR 25,000 and EUR 50,000?
EUR 25,000 is the classic EU microcredit definition (COM(2007) 708) – a conceptual and social-policy anchor. EUR 50,000 is the operational per-transaction ceiling of the InvestEU guarantee instrument. The two do not contradict each other: the HUF 19.9 M (≈ EUR 50,000) upper limit of the Hungarian product family is calibrated to the latter, while the programme's self-definition rests on the former. In the JEREMIE period, only the foundation network's average loan (HUF 6.1 M, ≈ EUR 15,000) remained within the classic band.
What does the EIF partnership require on the domestic side?
The financial intermediary of an EU guarantee instrument must bear its own risk, on its own balance sheet – which is why the lending capital is transferred into ownership as a conditional grant, not as refinancing and not as asset management. As a non-bank intermediary, HSCF is subject to the substantive compliance requirement of the European Code of Good Conduct for Microcredit Provision (CoGC); the formal certification is in progress. Quarterly EIF reporting is automated by Credinfo.
A partner, not an applicant
The Hungarian microfinance profession is not a recipient but a shaper of the European set of standards: the Budapest (2013) and Rome (2016) professional recommendations were drawn up with Hungarian participation, the network's practice has won European awards, and HSCF today is an accessible partner of the Commission, the EIF and the European networks.
Sources: HSCF note for DG EMPL (21 September 2026); MAC background study and Hungarian country input (18 September 2026); CoGC self-assessment and MFR business model form (9 September 2026); point 6.3 of the explanatory paper. “Directive” here means a professional recommendation, not an EU directive.
T1 and T2 – what they solve
Microlending has had no statutory framework since 2003: the Credit Institutions Act removed foundation microlending from its scope but put no rule in its place. The need for settlement was recorded by the state side itself in 2004 (“can only be done by an Act. So this must be settled.”) and in 2017 (KABHÁT 6/2/2017). The two drafts were prepared with the involvement of external experts and are in a state ready for submission as a private member's bill with the Government's supporting position. Reading them is best begun with the explanatory memorandum.
Draft Act on the microcredit activity of the Hungarian Sustainability Centre Foundation and of the county and Budapest enterprise development foundations
- Definitions (§ 2): microcredit, microcredit activity, positive social-purpose microcredit, target group, public funds.
- Operating requirements and mandatory social impact measurement (§§ 8–11); public-benefit status, prohibition of deposit-taking.
- Public task and service of general economic interest (§ 12) – public service compensation under Commission Decision (EU) 2025/2630; de minimis at final-beneficiary level ((EU) 2023/2831).
- Open accreditation for the existing county and Budapest network (§§ 21–22); a supervisory authority over the activity: the minister responsible for economic development (§§ 23, 38).
- Coordinator (§§ 24–25): seven conditions to be met continuously, five-yearly review, revocable mandate – not a privilege but an additional undertaking; it confers no new lending entitlement.
- Founder's rights and organisational transition (§§ 30–37): the founder's rights of the state, municipalities and political parties pass to the Coordinator; the central bank's founder's rights are left untouched by the Act; the foundations remain independent legal entities with their own boards of trustees. (Refinement of the explanatory memorandum to these sections is under legal review; the next text version will incorporate it.)
- Exemption under the Credit Institutions Act (Hpt.) (§ 40): the operating organisation takes the place of the National Microcredit Fund, which never came into being.
Draft Act on transitional provisions concerning public funds earmarked for social-purpose microcredit
- It assigns the public funds earmarked for microlending and currently under management to the Coordinator as earmarked assets, by operation of law – with earmarking, a prohibition of withdrawal, segregated management, supervision and reporting.
- Itemised asset inventory (full asset statement within 30 days, statutory lifting of confidentiality claims, forensic audit), transfer within 90 days, interim asset trustee, value guarantee.
- Rebuttable presumption of public-fund origin: whoever proves private origin is exempt; bona fide acquirers are protected; all legal effects arise from the day of promulgation (retroactive effect excluded).
- It recognises the county and Budapest foundations' own assets (§ 5) – it grants nothing, but records the position that follows from the grant agreements and is evidenced by documents; the transfer of assets subject to litigation is suspended until the final conclusion of the proceedings.
- Entails no budget expenditure: it settles existing, revolving earmarked assets. T2 does not affect MFB.
- Starting point: the Government–MVA agreement of 17 May 2000 designated the Hungarian State as owner of the “National Microcredit Fund” and MVA as its manager; the manager's published financial statements, however, show the programme funds under management (2025: HUF 20.65 bn, ≈ EUR 51.6 M) as its own equity. The two statements cannot both stand; judging them is the task of the competent bodies – what falls to the Government is creating the regulatory framework and earmarking the public funds.
Why a private member's bill, with the Government's supporting position?
Time: under the urgent procedure, around two weeks from submission to promulgation, versus months for a government bill. Preparedness: the professional groundwork was produced outside the ministry and is ready; the ministry responsible for supervision recorded in writing in May 2023 that it holds no data relating to the programme (FEF/48/3/2023). Protection: T2 protects the earmarked assets from the day T1 is submitted; the long public phase of a government bill would leave this window wide open. The proposal was prepared not against the Government, but by a faster and safer route.
Why transfer into ownership, and why not asset management?
Only an owner can lend, only the entitled party can take over capital, and only an organisation bearing its own risk can be the intermediary of an EU guarantee instrument. The cost coverage of the non-profit model (interest-free periods, mandatory support, technology) can be secured durably only by self-owned, revolving earmarked assets. This was also the legal construction of the demonstrably most successful Hungarian model, that of 1992–2000. Ownership here is not a position of enrichment: the assets are earmarked and under a prohibition of withdrawal, the organisation is public-benefit, pays no dividends, and operates under ministerial supervision and public impact measurement.
Open questions we state ourselves
Constitutional and state-aid (SGEI) compliance are the subject of external legal opinions; without them the programme will not start. Open legal questions: clarifying the forum and the remedies for rebutting the presumption of public-fund origin; segregated handling of assets subject to litigation; narrowing the lifting of confidentiality to its purpose, with a data protection impact assessment; a creditor protection procedure; an ex-post value and restitution guarantee. Open professional questions: the multi-year expenditure ceiling and the unit-cost targets until the guarantee negotiations are concluded; the capital takeover ratios; formal certification under the CoGC; the consolidation of the weaker network members. Beyond stating the facts, the materials offer no assessment of the pending court proceedings.
What is needed to launch
The programme is not a concept but an implementation framework: the professional, technological and EU sides are ready. What remains is decision and legislation – in this order: the statutory framework, the settlement of the legacy public funds and the domestic capital, then publication of the products. Filter the steps by whose move it is, and click for details.
Signature of the guarantee agreement with the EIF (expected in the coming weeks); the Government's supporting position; submission of T1/T2; data request to MVA under the 2000 agreement; programme announcement naming the settlement; joint MFB–HSCF working group.
Data request evaluated; T1/T2 on the parliamentary agenda, under the urgent procedure; decision on the 2027 funding; JEREMIE allocation decision.
Promulgation; full asset inventory within 30 days, transfer of the earmarked assets within 90 days; first disbursement in Q1 2027.
Accreditation regime in place; the network prepared; the first impact-measurement baseline year closed; at the end of 2029, closure of the guaranteed pillar's disbursement window and preparation of a ceiling increase; from 2033, the first capital takeover review points.
The schedule shows the milestones proposed in Chapter 7 of the explanatory paper and in the package of proposed measures (20 October 2026); they shift depending on when the decisions are taken. Statuses as at 21 October 2026.
Reading – from the short to the detailed
The English documents – programme fiche, milestones, product palette, business plan, impact-management plan, the background study for the EMN–MFC committee – are available on request; the interactive planner and calculator open directly from the docs/ folder next to this page. The Hungarian originals (draft Acts T1 and T2, explanatory paper, funding sheet and the other one-pagers) are published on the Hungarian version of this page.
Suggested reading order for international partners
Common misunderstandings – what to watch for when reading the materials
We are ready to meet in person
We will provide any further data without delay, supported by documents, and we are happy to present the programme and the materials in person.
Magyar Fenntarthatósági Központ Alapítvány (MFKA) · Hungarian Sustainability Centre Foundation (HSCF) · Budai út 9–11, 8000 Székesfehérvár, Hungary · mfka.hu · merfoldkovek.mfka.hu