What are grants?

Subsidies or promotional loans are loans that the state grants to support business start-ups. Promotional loans are usually particularly cheap to repay. They are alternative financing instruments to equity and debt capital in the form of grants/subsidies, warranties, sureties, guarantees and participations. Funding comes in the form of grants, i.e. money that companies receive for specific purposes. In most cases, this can cover part of the project costs, but it also requires a personal contribution. Funding is government support that is awarded to achieve specific political or economic goals. These can be awarded, for example, in the form of start-up grants or project cost grants.

Who can apply for funding?

Companies, institutions or private individuals who do not have enough money to set up a company or project ideas can receive state aid under certain conditions. Subsidies are funds that are awarded for new companies, for the further development of companies or to individuals. Public subsidies are not financial gifts, but the recipient has to meet specified criteria in order to receive them. It must therefore first be determined whether the criteria for the individual case are met. Of course, you have to know what funding is available and under what conditions.

Who awards grants?

State institutions (KfW, development banks, guarantee banks, Landwirtschaftliche Rentenbank) or the EU, the federal government or the states allocate funds in the form of grants and loans. Die Kreditanstalt für Wiederaufbau – known as the KfW Bank for short – is the most well-known funding agency. It provides support in the form of loans. Public funding is awarded by the EU, the federal government or the individual federal states. There are different institutions such as the ministries, the employment agency or special companies that are responsible for the permit.

Funding tips

What role does your house bank play in promotional loans?

If you want to apply for development loans, you usually have to contact your house bank. She checks the applications and forwards them to the responsible development banks. The development loans with mostly more favorable conditions than loans from the house bank.

The first three steps if you want to apply for funding:

1. Determine what you need funding for and create a brief description

2. Search for funding opportunities that are suitable for your project. A very helpful page is: https://www.foerderdatabase.de/

3. Don’t get discouraged.