EU Funds for Small and Medium Enterprises

EU Financial Support for SMEs
Funds are sufficiently available. But where is the money?
In view of the time after the COVID-19 crisis, financing the revitalization of the economy, particularly of SMEs and Crafts in Europe and worldwide is of highest importance. Since many owners of smaller businesses need advice and help when applying for EU funding, it seems important to me to explain the practical details of the EU SME funding programs in more detail. I have therefore held in-depth consultations with the European Investment Bank and with bank officials from EU correspondent banks. I would like to summarize the results in this article as follows:
The European Commission welcomed the Council decision to adopt the next long-term EU budget for the period 2021-2027, which is the final step in the adoption process. With this decision, all the conditions have now been fulfilled for the next multiannual financial framework for 2021-2027 to be in place as of 1 January 2021. As a result, €1.074 trillion [in 2018 prices] will become available for beneficiaries of EU funding during the next seven years.
President Ursula von der Leyen said: “With NextGenerationEU and the new long term budget, we will be able to provide European people, businesses, regions and cities with the support they urgently need to recover from the coronavirus pandemic. Today is a day of hope for Europe! We will build a greener, more digital and more resilient Europe, ready for today's and tomorrow's challenges”.

The EIB- European Investment Bank
provides support to small and medium-sized enterprises (SMEs) and mid-caps through “intermediated loans”, whereby the EIB makes loans to local banks and other intermediaries which subsequently on-lend to the final beneficiaries.

Promoters are requested to apply directly to one of the intermediary banks and financing institutions, which operate on a national, regional or local level. The conditions of financing (interest rate, grace period, loan period etc.) are determined by the EIB partner bank. Within this context, it is up to the partner bank that examines the application and bears the credit risk, to decide whether or not to finance the project. Requirements for application may vary according to the respective intermediary, and the EIB does not take part in this process.
Summary
Who is eligible

Depending on the criteria agreed with a specific intermediator, the following final beneficiaries are eligible:

What is eligible
The intermediated loans are to finance small investments by:
SMEs and mid-caps into tangible and intangible assets, including purchase or renovation of assets, long-term working capital, etc.
Local authorities and public sector entities or private promoters of any size, in projects promoting at least one of the EIB’s priorities.

The European Investment Fund (EIF)
Private Banks are normally hesitating to extend loans to start-up without longer track records. Financing possibilities offered by the European Investment Fund (EIF) could be of interest. The EIF helpdesk can be contacted at info@eif.org. EIB’s activity towards SMEs and mid-caps is typically more focused on delivering financial support (mainly funded) to established enterprises, mostly in the growth or maturity stages.

The EIF concentrates on supporting enterprises in earlier stages of growth and the provision of guarantee schemes. Please address EIF’s financial intermediaries in your country to find out more about sources of finance backed by the EIF
Summary
By developing and offering targeted financial products to EIF’s intermediaries, such as banks, guarantee and leasing companies, micro-credit providers and private equity funds, EIFenhance SMEs access to finance.
EIF’s objectives
By taking SME risk, we pursue our two main statutory objectives:
fostering EU objectives, notably in the field of entrepreneurship, growth, innovation, research and development, employment and regional development, generating an appropriate return for our shareholders, through a commercial pricing policy and a balance of fee and risk based income.
Grants and Funds for NGOs
The EIB does not provide grants or financial aid. Individuals and organiyations interested in gaining access to European funds in the form of grants should contact the European Commission directly.
About Grants
Most of the grants are awarded following calls for proposals. A call for proposals is a public procedure launched by the Contracting Authority, addressed to clearly identified categories of applicants, to promote actions falling within the framework of a specific EU programme.
Grants are direct financial contributions from the EU budget or from the European Development Fund. They are granted by way of donation to beneficiaries that are engaged in external aid activities. The Contracting Authority awards grants that are used to implement projects or activities that relate to the EU’s external aid programmes.
More about grants, grant applications, project proposals, eligible costs, project phases and project evaluations.
Civil Society Organizations (NGOs) have to register in e-Calls PADOR
All organisations that apply for calls for proposals as applicants, co-applicants or affiliated entities have to be registered in e-Calls PADOR. This includes Civil Society Organisations, public administration bodies, and local authorities.
The Commission makes direct financial contributions in the form of grants in support of projects or organizations which further the interests of the EU or contribute to the implementation of an EU programme or policy. Interested parties can apply by responding to calls for proposals.

It can also be noted that the European Investment Project Portal (EIPP) may be a useful resource depending upon the characteristics of a project. The EIPP is intended to provide a vehicle for project promoters to attract additional private investors worldwide. It is managed by the European Commission.

For more information and possible assistance please contact the author by e-mail: generalsecretary@wusme.org

WUSME
Garas utca 22, 1026 Budapest Hungary
General Secretariat
+361-3151059
mailto: wus@europe.com
web: www.wusme.org

WUSME is a Civil Society Organizartion in Consultative Status at UN ECOSOC and UNIDO safeguarding the rights, interests and competitiveness of SMEs.

This release was published on openPR.