2. ACCESS TO RISK FINANCE

Horizon 2020 will set up two facilities (the 'Equity facility' and the 'Debt facility'), composed of various windows. The Equity facility and the SME window of the Debt facility will be implemented in interdependence with COSME, as part of two Union Financial Instruments that provide equity and debt to support R&I and growth of SMEs. The Equity facility and the Debt facility may, where appropriate, allow pooling of financial resources with Member States or regions willing to contribute part of the ESI Funds allocated to them, in accordance with Regulation (EU) No 1303/2013 of the European Parliament and of the Council Regulation (EU) No 1303/2013 of the European Parliament and of the Council of 17 December 2013 laying down common provisions on the European Regional Development Fund, the European Social Fund, the Cohesion Fund, the European Agricultural Fund for Rural Development and the European Maritime and Fisheries Fund and laying down general provisions on the European Regional Development Fund, the European Social Fund and the Cohesion Fund and repealing Council Regulation (EC) No 1083/2006 (See page 320 of this Official Journal.). . Instead of providing for instance loans, guarantees or equity directly to final beneficiaries, the Commission will delegate to financial institutions the provision of support via, in particular, risk-sharing, guarantee schemes and equity and quasi-equity investments. The Debt facility will provide loans to single beneficiaries for investment in R&I; (counter-) guarantees to financial intermediaries providing loans to beneficiaries; combinations of loans and (counter-) guarantees; and guarantees and/or counter-guarantees for national or regional debt-financing schemes. The Debt facility will undertake maturity enhancement activities, and it will support the dedicated SME Instrument, subject to the level of demand (see section 3 'Innovation in SMEs' of Part II). Provisions from the Debt facility may be combined, with the possible addition of grants (including lump sums), with provisions from the Equity facility in one or more integrated schemes. Soft loans, convertible loans, subordinated loans, participating loans, leasing loans and securitisation may also be possible. As well as providing loans and guarantees on a market-driven, first-come, first-served basis, the Debt facility will target, under a series of compartments, particular policies and sectors. Ring-fenced budgetary contributions for this purpose may, where appropriate, come from: other parts of Horizon 2020, notably Part III 'Societal challenges'; other frameworks, programmes and budget lines in the general budget of the Union; particular regions and Member States that wish to contribute with resources available from the Cohesion Policy Funds; and specific entities (such as Joint Technology Initiatives) or initiatives. Such budgetary contributions may be made or topped up at any time during the course of Horizon 2020. Risk-sharing and other parameters may vary within policy or sector compartments, provided their values or states comply with the common rules for debt instruments. Furthermore, compartments may have specific communications strategies within the overall promotional campaign for the Debt facility. In addition, specialist intermediaries at national level may be used if specific expertise is needed to assess prospective loans in the domain of a particular compartment. The SME window under the Debt facility shall target R&I-driven SMEs and small mid-caps with loan amounts exceeding EUR 150000, thus complementing finance to SMEs by the Loan Guarantee Facility under COSME. The SME window of the Debt facility shall also cover loans below EUR 150000 for R&I-driven SMEs and small mid-caps. The leverage of the Debt facility - defined as the total funding (i.e. Union funding plus contribution from other financial institutions) divided by the Union financial contribution - is expected to range from an average 1,5 to 6,5, depending on the type of operations involved (level of risk, target beneficiaries, and the particular debt financial instrument facility concerned). The multiplier effect - defined as the total of investments made by supported beneficiaries divided by the Union financial contribution - is expected to be 5 to 20, again depending on the type of operations involved. The Equity facility will focus on early-stage venture capital funds and public and private funds-of-funds providing venture capital and/or mezzanine capital to individual portfolio enterprises. These enterprises may, in addition, seek debt financing from financial intermediaries implementing the Debt facility. Furthermore, the Equity facility will also explore possibilities to support business angels and other potential sources of equity finance. This could also include support at the phase 3 stage of the SME instrument subject to the level of demand, as well as to technology transfer (including the transfer of research results and inventions stemming from the sphere of public research to the productive sector, for example through proof-of-concept). The Equity facility will also have the possibility to make expansion and growth-stage investments in conjunction with the Equity Facility for Growth (EFG) under COSME (this includes investments in funds-of-funds with a broad investor base and includes private institutional and strategic investors as well as national public and semi-public financial institutions). In the latter case, the investment from the Equity facility of Horizon 2020 shall not exceed 20 % of the total Union investment except in cases of multi-stage funds, where funding from EFG and the Equity facility of Horizon 2020 will be provided on a pro rata basis, based on the funds' investment policy. Like the EFG, the Equity facility shall avoid buy-out or replacement capital intended for the dismantling of an acquired enterprise. The Commission may decide to amend the 20 % threshold in light of changing market conditions. The Union Equity Financial Instrument for SMEs' R&I and growth referred to in the first paragraph of section 2 should be of an appropriate size and scale to back innovative companies from the earliest stage through to growth and expansion, in an integrated approach. Investment parameters will be set in such a way that specific policy objectives, including the targeting of particular groups of potential beneficiaries, can be achieved while still preserving the market-oriented, demand-driven approach of this instrument. The Equity facility may be supported by budgetary contributions from: other parts of Horizon 2020; other frameworks, programmes and budget lines in the general budget of the Union; particular regions and Member States; and specific entities or initiatives. The leverage of the Equity facility - defined as the total funding (i.e. Union funding plus contribution from other financial institutions) divided by the Union financial contribution - is expected to be around 6, depending on market specificities, with an expected multiplier effect - defined as the total of investments made by supported beneficiaries divided by the Union financial contribution - of, on average, 18. The implementation of the two facilities will be delegated to the European Investment Bank Group (EIB and the European Investment Fund (EIF)) and/or to other financial institutions that may be entrusted with the implementation of financial instruments in compliance with Regulation (EU, Euratom) No 966/2012. Their design and implementation will be aligned with the general provisions for financial instruments set out in that Regulation and with more specific operational requirements to be set out in Commission guidance. The use of financial instruments must have a clear European added value and should provide leverage and function as a complement to national instruments. Financial intermediaries, selected by entrusted entities for the implementation of financial instruments pursuant to Article 139(4) of Regulation (EU, Euratom) No 966/2012 on the basis of open, transparent, proportionate and non-discriminatory procedures, may include private financial institutions as well as governmental and semi-governmental financial institutions, national and regional public banks as well as national and regional investment banks. Their elements may be combined, with the possible addition of grants (including lump sums), in one or more integrated schemes supporting particular categories of beneficiary or special-purpose projects, such as SMEs and mid-caps with growth potential, or the large-scale demonstration of innovative technologies. Their implementation will be supported by a set of accompanying measures. These may include technical assistance for financial intermediaries involved in assessing the eligibility of loan applications or the value of knowledge assets; investment-readiness schemes covering incubating, coaching and mentoring SMEs and fostering their interaction with potential investors; measures to raise the awareness of venture capital firms and business angels of the growth potential of innovative SMEs involved in Union funding programmes; schemes to attract private investors to support the growth of innovative SMEs and mid-caps; actions to improve cross-border and multi-country debt and equity financing; schemes for encouraging philanthropic foundations and individuals to support R&I; and schemes to foster corporate venturing and encourage the activities of family offices and business angels. Bodies such as regional authorities, SMEs associations, chambers of commerce and relevant financial intermediaries may be consulted, as appropriate, in relation to the preparation and implementation of these activities. Complementarity will be ensured with the facilities of COSME.

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Source: EUR-Lex (Cellar) · retrieved 2026-11-04 · Text as adopted (Official Journal); later amendments are not incorporated in this text.