The new ERP promotional loan program will come into force from November 2024 and offers low-interest loans as well as complete relief from the risk of loan default for founders and company successors. Here is an overview of the conditions and how to apply.
Start of the ERP development loan
A new funding instrument for start-up and succession financing will be available from November 1, 2024. The ERP promotional loan program for start-ups and succession is implemented by KfW, the German Guarantee Banks and the Federal Ministries of Economics and Finance. This offer is aimed at founders and company successors and aims to facilitate access to capital and minimize the risk for participating banks.
Details of the funding
The program makes it possible to finance up to 35 percent of a project with a maximum loan amount of 500,000 euros. The special feature here is the full risk coverage provided by guarantee banks, which assume a 100 percent guarantee for the repayment of the loans, supported by an 80 percent counter-guarantee from the federal government. This should enable the house banks to offer the loans at reduced interest rates without having to use their own refinancing sources.
Application process and conditions
Applications for the ERP promotional loan can be submitted directly via the house banks, which forward the application to the responsible guarantee bank via a central platform. Once the guarantee has been approved, KfW takes over the refinancing of the house bank. This procedure is intended to increase transparency and simplify processes for applicants.
Integration into the existing funding landscape
The ERP promotional loan program can be combined with other funding measures. It is in line with the WIN initiative, which aims to strengthen the startup ecosystem in Germany through improved framework conditions and access to resources. The combination of both initiatives is intended to provide a more comprehensive approach to supporting start-ups and business succession.
Outlook
The introduction of the ERP promotional loan increases the range of financial resources available to the start-up scene and German SMEs. The strategic partnership between KfW, guarantee banks and the federal ministries underlines the importance of coordinated support for start-ups and securing business succession in an increasingly dynamic economy.
Further information and the opportunity to apply can be found at kfw.de/077 or kapital.ermoeglicher.de
Supplementary article: Start-up strategy and WIN initiative for progress
