Loan Capital
Financing Module

A selection of current loan programmes is provided in the following. These are government subsidised low interest loans. They are often made up of a balanced package of finance with a low rate of interest which can generally be fixed for the full term of the loan.

Our experts offer you the opportunity to get their advice on sources of funding at no obligation to you.

Your contact person: Nadine Schwarz
E-Mail: nadine.schwarz@so-einfach-gehts-netbvbug.de

Funding objective: Long-term financing for market-oriented research and development of new products, production processes and services as well as for their introduction on the market in Germany.
Programme Part I - Development loan for the research and development phase
The following measures can be co-financed: All individual staff costs, overhead costs, travel expenses, costs of material and IT attributable to the project, plus individual costs of research and development assignments and of consulting services and similar services. Maximum loan value: EUR 5 million per project. Financing is available for 100% of the eligible costs
Eligibility: Commercial enterprises which have been operating in the market for at least two years. Maximum group turnover of EUR 500 million
Programme Part II  - Market entry phase for innovative products / processes or services
Loan value: In western Germany a maximum of EUR 1 million per project; in eastern Germany, including Berlin, a maximum of EUR 2.5 million per project
Financing: In western Germany financing is available for 50% of the eligible costs; in eastern Germany, including Berlin, financing is available for 80% of the eligible costs
Eligibility: Commercial enterprises, only SMEs (which employ fewer than 250 persons and which have an annual group turnover not exceeding EUR 50 million or an annual balance sheet total not exceeding EUR 43 million)
Terms: Interest rate of not less than 1% (credit rating A); fixed interest for the entire term; small enterprises (which employ fewer than 50 persons and which have an annual turnover or an annual balance sheet total not exceeding EUR 10 million) enjoy particularly favourable terms.
Financing package comprised of a debt capital tranche and a subordinated tranche:

• Debt capital tranche: 40%, 50% or 100% of the loan;
  Loan term of 10 years, grace period of 2 years, to be secured by customary banking collateral
• Subordinated tranche: 50% or 60% of the loan
  Loan term of 10 years, grace period of 7 years, no collateral required

Funding objective: The German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) promotes investment projects of a demonstration character which demonstrate ways of preventing or reducing environmental pollution by means of innovative technological processes or novel process combinations and therefore reduce the use of resources and energy. Funding is provided for investment in construction, machinery or other types of investment within Germany, including commissioning and all necessary measurements of the effectiveness of the projects in the following fields:

• Waste water treatment/hydraulic engineering
• Waste prevention, recycling and waste disposal, as well as brownfield remediation
• Soil protection
• Air pollution control (including measures for the reduction of odours)
• Noise abatement and diminution of tremors, energy saving, energy efficiency and the use of renewable sources of energy
• Environmentally-friendly energy supply and distribution
• Resource efficiency and saving materials

Research and development activities are precluded from funding assistance.  
Eligibility: German and foreign business enterprises, other individuals and corporate bodies governed by private law, as well as municipalities, local authorities, administrative districts, public bodies, societies/associations, other public corporations or public undertakings and legally dependent undertakings of municipal corporations. Projects of small and medium sized enterprises are given preference for funding assistance.
Type, scope and level of funding: Funding assistance is provided either in the form of an interest subsidy to reduce the cost of a loan, or an investment grant. Loans can be granted with interest subsidies for up to 70% of the eligible costs. Investment grants can generally be awarded for up to 30% of the eligible costs (part funding).
Terms: Loan term of up to 30 years, grace period of up to 5 years, interest rates of 2.2% to 6.55% nominal (subject to credit rating, price bracket A-I), 100% disbursement

Funding objective: Loans at favourable interest rates for the financing of all investments in fixed assets and for the acquisition of working capital for starting up and running young enterprises. 

• Capital expenditure (acquisition of plant, machinery, computers, property & buildings, construction costs, installations, company vehicles, business and factory equipment, intangible investments (licenses & patents), software
• Working capital (stocks of materials, inventories and spare parts, personnel costs, rental costs, costs for marketing, participation at trade fairs, costs for consulting)
• Acquisition of a company or an interest in a company in association with the assumption of an executive position

Eligibility: Business starters, corporate successors and small, recently established companies (which employ fewer than 50 persons and which have a turnover or balance sheet total not exceeding EUR 10 million), with a financing sum of up to EUR 100,000 per applicant, which have been active in the market for less than three years. Part-time businesses if the plan is to achieve full-time self-employment in the medium term. Activities for the consolidation of young enterprises in the first three years of their existence.
Terms: Maximum amount: EUR 100,000 (of which up to EUR 30,000 for working capital); 100% disbursement;
80% exemption from liability for the "house" bank/no collateral required; collateral of 20% required according to standard banking practices; no equity capital required; unscheduled early repayments allowed

• Standardised effective rate of interest of 2.89%, irrespective of collateral and risk assessment; maximum term of 5 years, with a grace period of one year and fixed interest for the entire term
• Terms of up to 10 years are available with an effective rate of interest of 3.14%, with a grace period of two years and fixed interest for the entire term
• Personal liability for the repayment of the loan

Funding objective: Financing package at favourable interest rates combining a classical loan and subordinated loan for financing short and long term investments in fixed assets and for the acquisition of working capital for projects in Germany and abroad for small and medium sized enterprises. The loan can be used for the following capital investments:

• Acquisition of property and buildings, construction costs
• Acquisition of machinery, plants and installations
• Company vehicles
• Business and factory equipment
• Technology, software, licenses
• Acquisition of assets from other enterprises, including takeovers and active participation in the form of asset deals (purely financial investments are excluded)

Eligibility: Freelance professions and German and foreign enterprises which have been active on the market for at least three years. Only for SMEs (which employ less than 250 persons and which have an annual turnover not exceeding EUR 50 million or an annual balance sheet total not exceeding EUR 43 million). Foreign subsidiaries of German enterprises and joint ventures abroad with at least 30% German participation are also eligible for support.
Terms: Maximum loan value: EUR 4 million per project. 100% disbursement in two equal tranches (debt capital tranche and subordinated tranche). The loan term for both tranches is 10 years. A grace period of two years is available for the debt capital tranche. The subordinated loan has a grace period of 7 years. Unscheduled early repayments cannot be made for either tranche.

• Interest rate of not less than 1.81% (credit rating A); fixed interest for the entire term.
• Possibility of combining with other KfW programmes and public funding available. Collateral is required for the debt capital tranche according to standard banking practices. Exemption from liability for the subordinated tranche.