Are you a credit institution? Are you a private investor (insurance company, investment fund, investment holding…?? Are you interested in investing in or lending more in or to the social sector? Then the EU Investment Plan can be a new option for you.
The EU Investment Plan is an important initiative developed by the European Union and the European Investment Bank (EIB) to help overcome the current investment gap in the EU by mobilizing private financing for strategic investments. This means that EU Investment Plans aims to support private investors in making investments into certain key strategic areas, which they are not yet fully doing.
To achieve this, the EU Investment Plan works on three main areas:
- European Fund for Strategic Investment (EFSI): unlocking investment of over €300 billion over three years into European SMEs and infrastructure projects
- Advice and support: providing support to stakeholders through the European Investment Advisory Hub (EIAH) and the EU Investment Project Portal (EIPP)
- Facilitating Legal Frameworks: supporting investment in the real economy
More information about the EU Investment Plan can be found here.
In short, EFSI gives investors greater confidence to invest in riskier projects, such as large-scale, long-term investment projects in infrastructure.
EFSI facilitates access to better loans by using EU money as a guarantee for private investors. To date EFSI has supported up to 1,000 financial intermediaries to provide decent loans to 100,000s of SMEs and Infrastructure projects; at a better rate than without any intervention by EFSI.
Through a €21 billion budget, coming from the EU and the EIB, EFSI aims at unlocking €330 billion worth of additional investment into the real economy. The objective is to address a funding gap that is hampering the ability of enterprises to expand and innovate to their full potential due to limited access to private funding for certain high-risk projects.
More information on EFSI can be found here.
A key component of EFSI is that it is demand-driven, meaning that project developers have to apply before receiving EFSI support. Another key ingredient is that accessing EFSI depends on the size of your project and financing needs.
EFSI is delivered through two main windows:
- Infrastructure & Innovation Window
- supports projects requiring over €25 million of investment
- provides direct loans through the European Investment Bank
- can help to attract other important investors to finance your project
- Small and Medium-sized Enterprise (SME) Window
- supports projects under €25 million
- is implemented through financial intermediaries (selected banks and other private investors) to provide loans to Enterprises, including social service providers, as well as to local, regional and national authorities
- is implemented through a variety of different programmes (COSME, InnovFin, EaSI)
With the term financial intermediair(y)ies, the European Investment Bank means
- banks or credit institutions,
- investment funds,
- microcredit institutions,
- guarantee schemes,
- guarantee institutions,
- family offices,
- social investment funds
- or other institutions duly authorised to provide loans/guarantees or risk-sharing structures according to the applicable legislation.
This website aims at providing a general support, advice and guidance for private financers to use EFSI or -more broadly- EIB financial support to invest in the social sector.
For larger projects: the EU Investment Project Portal (EIPP) is a database of projects to help investors find and access project developers throughout the world. The Portal publishes projects which are
- Worth at least €10 million
- Expected to start within 3 years of their submission to the EIPP
- Promoted by a public or private legal entity established in an EU country
- Compatible with all applicable EU and national laws.
The European Investment Advisory Hub (EIAH) can provide support, advice and guidance for project developers who may require it to attract investors such as yourselves.
- A one-stop-shop for a variety of different advisory and technical assistance programs and initiatives for both public and private beneficiaries, provided by high-level experts
- A cooperation platform to exchange and share the expertise developed among the EIAH partners and stakeholders
- An instrument to evaluate and address new needs by reinforcing or extending existing services provided by the EIAH or creating news ones as demand arises
- Click here for a video of the EIAH
Investors can also contact the European Investment Bank directly for more information using this contact form..
In most cases, a EFSI intervention would provide a better loan deal for your needs than many other options. This is a result of the fact that EFSI reduces the risk for financial Intermediaries and the EIB to invest in your project by providing guarantees against a part of the possible losses.
It is however difficult to state with precision the advantages EFSI and other EIB programmes may bring for your specific project given that your project would need to be analysed first. Such criteria would include matters such as income/revenue structures, sustainable business plans, good governance, et cetera.
The number of financial intermediaries demonstrates the benefits many private investors see for using EFSI as a way to invest in new sectors, including the social sector. The Success Stories also show the benefits EFSI could provide for your project plan.