Italy: Addressing the “small credit” gap to enhance productivity and growth in the Lazio Region

Evaluating the Fondo Piccolo Credito: a partnership for better policy

The evaluation of the Fondo Piccolo Credito (FPC) is the result of a collaboration between the Lazio Region and the OECD Trento Centre for local development, through its Spatial Productivity Lab, carried out in a context of growing attention to the quality and effectiveness of regional policy, particularly within the framework of the European Regional Development Fund (ERDF). This joint effort reflects a shared commitment to evidence-based policymaking.

This evaluation demonstrates how collaboration between regional authorities and international organisations can improve policy outcomes. The Lazio Region provided detailed administrative data and insights into programme design, while the OECD contributed methodological expertise and an independent perspective. Together, they produced actionable evidence to inform future editions of FPC and similar instruments across the OECD.

What is Fondo Piccolo Credito (FPC)?

FPC is a financial instrument designed to address a structural market failure: the under-provision of small loans to creditworthy micro and small enterprises. Banks often avoid issuing small loans because the fixed costs of credit screening are high relative to the expected returns. FPC corrects this imbalance by offering zero-interest loans of up to EUR 50 000, repayable over five years, enabling firms to invest, grow, and strengthen their resilience.

Implementation period: November 2024 – December 2025. 

Why counterfactual evaluation matters

Understanding whether a policy truly works requires more than tracking outputs: it requires isolating the causal impact of the intervention. This is where counterfactual evaluation comes in. It compares what happened to beneficiaries with what would have happened without the programme, using a suitable control group. In the case of FPC, the OECD applied a difference-in-differences approach, comparing firms that received loans with similar firms whose applications were rejected for administrative reasons.

Counterfactual evaluations are important because they:

• Provide credible evidence on what works, for whom, and under what conditions.
• Help policymakers validate assumptions and refine programme design.
• Ensure cost-effectiveness and accountability in the use of public funds.

For more information, please contact Carlo.Menon@oecd.org.