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State Secretary of Economic Affairs and Climate Policy Mona Keijzer presented the evaluation of the GO scheme to the Dutch House of Representatives on 28th October, conducted by Dialogic in collaboration with Erasmus University (see policy letter). This scheme, dating back to 2009, aims to boost credit lending by providing a state guarantee on bank loans. Its objective is to stimulate banks to provide credit to medium-sized, fundamentally healthy enterprises facing challenges in obtaining financing. Banks are the primary users of the scheme. Between 2009 and 2018, a total of 369 guarantees were granted to 316 unique businesses through the GO scheme. During this period, €2.8 billion in loans were contracted under the GO facility, with the State providing €1.4 billion in guarantees. 92% of the businesses benefiting from the GO scheme are classified as SMEs in the year of application. A widened GO-Coronamodule (GO-C) has been introduced based on the temporary European Commission state aid framework for COVID-19.
Dialogic has assessed the GO scheme as a legitimate instrument. The scheme has been deemed predominantly effective and assists businesses with sound plans in securing financing (under acceptable conditions), which they would otherwise struggle to obtain or only partially secure. However, there are indications that financial additionality is highest during crises and decreases in times of economic growth. Regarding economic additionality, there are signs of positive impacts on the performance of businesses benefiting from the GO. A strong effect is observed in cumulative growth in total assets, with more short-term positive effects on net turnover and payroll. These findings largely align with research on similar guarantee schemes abroad but should be interpreted with caution regarding the GO scheme from a methodological perspective. It has also been noted that the GO scheme is (increasingly) efficiently and professionally executed, currently covering costs (as required by Europe) and incurring minimal administrative burdens for users (financial institutions and businesses).
Ten recommendations have been put forward for potential adjustments to the GO scheme, including allowing alternative (non-bank) financiers to participate, keeping the guarantee ceiling flexible, and suggesting a stronger focus on financing with added societal value. The State Secretary has indicated her intention to revisit the proposed adjustments suggested by Dialogic (and inform the Parliament accordingly) following discussions with RVO.nl, banks, and non-bank financiers.
