The new ERP promotional loan programme will come into force from November 2024 and offers low-interest loans and complete relief from the risk of loan default for founders and business successors. Here is an overview of the conditions and how to apply.
Launch of the ERP promotional loan
A new funding instrument for start-up and succession financing will be available from 1 November 2024. The ERP promotional loan programme 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 minimise the risk for participating banks.
Details of the funding programme
The programme makes it possible to finance up to 35% of a project with a maximum loan amount of 500,000 euros. The special feature here is the full risk cover provided by guarantee banks, which assume a 100 per cent guarantee for the repayment of the loans, supported by an 80 per cent counter-guarantee from the federal government. This should enable the house banks to offer the loans at favourable interest rates without having to use their own refinancing sources.
Application process and conditions
Applications for the ERP subsidised 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 promotional landscape
The ERP promotional loan programme can be combined with other promotional measures. It is in line with the WIN initiative, which aims to strengthen the startup ecosystem in Germany by improving framework conditions and access to resources. The combination of both initiatives is intended to provide a more comprehensive approach to supporting business start-ups and succession.
Outlook
The introduction of the ERP promotional loan will increase the range of financial resources available to the startup scene and German SMEs. The strategic partnership between KfW, guarantee banks and the federal ministries emphasises the importance of coordinated support for business 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
