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Internal Market, Industry, Entrepreneurship and SMEs

Access to finance for SMEs

COSME financial instruments

The programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME) improves access to finance for SMEs through two financial instruments that have been available since August 2014.

Data and surveys - SAFE

The European Commission monitors developments in SMEs’ access to finance through the joint European Commission/European Central Bank Survey on the access to finance of enterprises (SAFE).

Europe’s 25 million small and medium-sized enterprises (SMEs) are our focus. They represent over 99% of businesses in the EU. They employ two out of every three employees, create 85% of all new jobs and generate about three-fifth of the EU value-added. Tailor-made support to help them grow and innovate is essential. At all stages of development, small businesses struggle more than large enterprises to get finance. To stay competitive, both start-ups and scale-ups rely on external finance for innovation, digitalisation, internationalisation and upskilling.

Coronavirus response in relation to financing for businesses

We have been mobilising financial support for SMEs through the COSME programme. In particular, we've boosted the existing 'Loan Guarantee Facility' (LGF) under the programme with additional resources from the European Fund for Strategic Investments to enable banks to offer bridge financing for SMEs. This includes long-term working capital loans (of 12 months or more), as well as credit holidays allowing for delayed repayments of existing loans.

To participate, financial intermediaries had to apply via the European Investment Fund by the end of 2020. Financial intermediaries participating in this programme can provide new financing to SMEs under favourable conditions and simplified eligibility criteria until 31 December 2021. SMEs in search of finance have the opportunity to apply for the working capital facilities directly from the participating financial intermediaries. More information and the names of the institutions are available on the access to finance website.

By 31 March 2021, more than 100,000 SMEs already received €7.7 billion of financing under the COSME LGF-Covid 19 measures.

Additionally, EU countries, national promotional and commercial banks have been putting measures in place for adversely affected SMEs. They focus on facilitating financing, in particular working capital, and flexibility on repayments of existing loans.

Lastly, The European Scale-up Action for Risk capital (ESCALAR) programme supports venture capital and growth financing to help promising companies scale up.

ESCALAR programme call for expression of interest for financial intermediaries and FAQ document
• Press release, 'Commission and EIF unlock €8 billion in finance for 100,000 SMEs'
• Press release, 'ESCALAR: up to €1.2 billion to help high potential companies grow and expand in Europe'
• The COSME programme for the competitiveness of SMEs and the Loan Guarantee Facility
Access to finance website

Financing your business

EU financing programmes are generally not provided as direct funding. We channel support through local, regional, or national authorities, or financial intermediaries such as banks and venture capital organisations that provide funding with financial instruments.

Visit the EU access to finance portal to find intermediaries.
See the introduction video on the EU access to finance.

EU financial instruments are risk-sharing schemes. Examples are guarantees to financial intermediaries who provide lending, lease finance, or co-investments with venture capital funds, backed by EU funds. Reputable financial intermediaries such as banks, lessors, mutual guarantee societies, microfinance providers and venture capital funds provide the final support. They are closer to the final beneficiaries and qualified to assess their needs and risks. Decisions to provide loans, guarantees, or venture capital are made by the local financial institutions. The exact financing conditions (such as the amount, duration, interest rate, and fees) depend on the financial institution.

EU financial instruments are market-driven, there are no country allocations and the availability of funding depends on the interest of local financial institutions taking part in the scheme. The financial intermediaries create individual products suited to the needs of SMEs in their market.

Policy areas

We use financial instruments and helps EU countries share good practice in the following policy areas

Forum of national financing experts of the SME Envoys Network

The SME envoys network's forum of national financing experts regularly analyses and discusses issues and solutions around improving access to finance for small businesses.

In 2021 we conducted a survey with the SME envoys network to help address the solvency risk affecting SMEs during and after the COVID-19 pandemic. As announced in the Industrial Strategy, we held a roundtable with national financial experts nominated by the SME envoys network at the end of September 2021. It addressed the exchange of good practices on national measures to aid recapitalisation, debt conversion, and SME balance sheet strengthening. 

Data and surveys - SAFE

The joint European Commission/European Central Bank survey on the access to finance of enterprises (SAFE) monitors developments in access to finance for small businesses.
Data and surveys - SAFE

Main EU initiatives