Financial Instruments

Financial Instruments for Innovation’ (Innova-FI)

The legislative and policy framework for 2014-2020 encourages further expansion and strengthening of the use of financial instruments in the new programming period. SERN is involved as a partner in the ‘Financial Instruments for Innovation’ (Innova-FI) project. The Interreg Europe project aims to improve the design and implementation of Financial Instruments as a means to deliver Structural Funds. They best meet and serve the financing needs of innovative and Research, Technology, Development and Innovation (RTDI)-driven businesses in all the stages of their growth. More information here.

What are innovative financial instruments?

They are a range of activities such as: Participation in equity (risk capital) funds;
Guarantees to local banks lending to a large number of final beneficiaries, for instance small and medium-sized enterprises (SMEs);
Risk-sharing with financial institutions to boost investment in large infrastructure projects.
Their aim is to boost the real economy through increasing the access to finance for enterprises and industry producing goods and services. Spending through innovative financial instruments is an alternative for spending EU budget rather than grants or subsidies.

Innovative financial instruments support economic growth

They attract funding from other public or private investors in areas of EU strong interest, but which are perceived as risky by investors. Examples include sectors with high economic growth and innovative business activities. The fact that the EU invests risk capital in a certain fund or covers part of the risk associated with a certain type of projects can reassure other investors and encourage them to invest alongside the EU. Moreover, innovative financial instruments have important non-financial effects such as the promotion of best practices. European Commission. (2018). Available here