Favorable loans for green and digital jobs

The Ministry of Regional Development and EU Funds of the Republic of Croatia assigned to the Croatian Bank for Reconstruction and Development (HBOR) the task of implementing the 'Production Modernisation Loans' financial instrument, for which the funds are provided by the European Regional Development Fund (ERDF). The loan contributes to boosting the productivity and competitiveness of micro, small, and medium enterprises by enabling more favourable financing conditions for investments that contribute to the goals of the digital and green transformation of operations and companies. Borrowers are micro, small, and medium enterprises from the private sector. Eligible investments are in fixed tangible and intangible assets. Loans are approved from ERDF funds and HBOR funds in a 50:50 ratio, with the possibility of writing off part of the loan principal from ERDF funds (up to a maximum of 50% of the total disbursed loan principal amount), upon the fulfilment of predefined criteria. The minimum loan amount is €100,000, while the maximum loan amount is €3,000,000. The interest rate on the part of the loan principal from the ERDF funds is 0.00% per annum. The part of the loan principal from the HBRD bears a fixed interest rate, which is determined separately for each loan on the basis of risk assessment. Repayment period depends on the purpose and structure of the investment, up to 15 years, including a grace period of up to 3 years.

On 4 December 2024, the Ministry of Economy launched a call for proposals “Innovation of newly created SMEs”. The total grant available under this call is € 14,622,642. The objective of the call-in question is to encourage: i) growth of start-ups developing innovative products within identified thematic priority areas of S3, based on knowledge or high digital technologies, and ii) the future development and marketing of products and increasing firms’ willingness to invest. The lowest amount of grants that can be awarded per individual project proposal is € 30,000.00, and the highest is € 140,000.00 per individual project proposal. Eligible activities may include the following: a) Further development of the technological readiness of the product, including testing, demonstration and incorporation of test results into the final product and optimization; b) Transfer of marketable technological solutions, knowledge and experience (knowledge and technology transfer) including related advisory services and training of employees; c) Feasibility study review; d) Product design to adapt the product to market requirements; e) Protection and management of the relevant intellectual property, including applications for recognition of rights and implementation of the procedure for recognition of intellectual property rights and development of a strategic plan for protection and management of intellectual property; and f) Preparation of production and investment in trial production, zero series. The start date for receiving project applications is 5 March 2025 at 11:00, and the final day for project proposals is 9 April 2025.

In the period from 1 April 2024 to 31 July 2024, the Croatian Bank for Reconstruction and Development (HBOR) has granted favourable loans to small and medium-sized enterprises as part of the National Recovery and Resilience Plan. Entrepreneurs whose investments focused on the green transition, digital transition, and strengthening of competitiveness and resilience were entitled to favourable loans. The smallest loan amount was €100,000, while the highest loan amount for start-up entrepreneurs was €500,000, while for other loan borrowers it was €1,000,000. Up to 85% of the estimated value of the investment (excluding VAT) can be credited. The repayment term, depending on the purpose and structure of the investment was up to 15 years, including a grace period of up to 3 years. While the interest rate was 0.8% per annum for investment in other areas, for investors in the green transition, digital transition, and strengthening of competitiveness and resilience it was 0.4% per annum.

The Ministry of Tourism and Sports has announced a call for grants to increase the competitiveness of the tourism economy through a green and digital transition in tourism. The total amount of funds for this activity is EUR 3,404,340, and the deadline for submitting project proposals is 15 March 2024. The program should contribute to the development of sustainable tourism products, improvement of processes in the catering business acceptable to the environment, digitization and improvement of the provision of catering and/or tourism services, development of innovative tourism products and services, circular economy and increase in energy efficiency. This means that eligible are subjects of small businesses, i.e. trading companies outside the public sector, trades and cooperatives as well as family farms or agricultural holdings, which are registered or will be registered for catering activities after the completion of the project activities. The grant awarding program is made up of five measures. Measure A, with a total value of EUR 1,000,000, supports investments in energy-efficient tangible assets and green transition, as well as digitization and improvement of work processes of existing hotels. The lowest amount of funds that can be allocated for this purpose is EUR 10,000, and the highest amount is EUR 35,000. The investment, among other things, can be in the replacement of energy- and process-inefficient professional catering equipment with efficient ones for the purpose of improving the technological process of food and beverage preparation and providing other services in hotels. Measure B refers to existing and new camps in the NUTS 2 region: Pannonia or Northern Croatia, whereby investments in energy-efficient material assets and green transition, as well as digitization and improvement of work processes are supported. The lowest amount of funds that can be allocated for measure B is EUR 6,000, while the highest amount is EUR 25,000. The total amount of funds determined for this purpose is EUR 800,000. Measure C refers to investments in energy-efficient tangible assets and green transition, as well as digitization and improvement of work processes of existing catering establishments with year-round operations and include a restaurant, inn, bistro or pastry shop. The lowest amount of funds that can be allocated is EUR 5,000, and the highest is EUR 15,000. The total allocation for this measure is worth EUR 700,000. Investments, in addition to those mentioned under measures A and B, can also be in the acquisition of new equipment related to environmental protection and the circular economy. For measure D, a total of EUR 404,340 is earmarked for investments by family and agricultural farms, farmers in new wineries or tasting rooms, as well as digitization and e-bottling for family farms. The lowest amount of funds that can be allocated is EUR 5,000, and the highest amount is EUR 15,000. Measure E, with a total value of EUR 500,000, refers to investments in existing vessels for excursions and renting with or without a crew and providing accommodation services for guests on the vessel. The lowest allocated amount can be EUR 5,000, and the highest amount is EUR 15,000. Among other things, investments can be in the replacement of gasoline auxiliary engines with electric engines, as well as the replacement of existing marine batteries with new models that will be more environmentally friendly.

The Ministry of Economy and Sustainable Development has announced a call for submission of project proposals 'Vouchers for Digitization' in order to encourage investments by micro, small and medium-sized enterprises aimed at the implementation of digitization and digital transformation of business. This business transformation is carried out through training and services to improve digital skills, including those related to cloud technologies, digital transformation strategies, digital marketing, increasing cyber resilience through system security checks and the application of complex digital solutions. The goal of this Call is to contribute to increasing the level of digital maturity of SMEs through the development of digital business models, strengthening the capacity to implement digitization and digital transformation or improving cyber security, which will ultimately increase the competitiveness and resilience of companies using digital technologies. Project proposals are submitted in the period from 1 to 29 March 2024 year, and the total available amount of funds is EUR 9,954,210.00 euros. Since EUR 6,636,140.00 have already been distributed in the previous deadlines, the remaining EUR 3,318,070 will be allocated in the said deadline, whereby the intensity of support for the applicant's activities is 60 percent. The maximum amount of grant that can be awarded to an individual project depends on the type of voucher. In the award process, the applicant can have only one project proposal at the same time, which requests the award of vouchers for services provided exclusively by one service provider, and which include one or more activities acceptable for the requested type of voucher. One applicant within this Call may use a maximum of two (2) vouchers, provided that they are different types of vouchers, whereby the total amount of support awarded to the entrepreneur must be in accordance with the rules on small value support. The purpose of this Call is to contribute to increasing the level of digital maturity of SMEs through the development of digital business models, strengthening the capacity to implement digitization and digital transformation or improving cyber security, which will ultimately increase the competitiveness and resilience of companies using digital technologies. Acceptable activities of the applicant are the creation of company websites, landing pages, mobile applications, web applications and websites for e-commerce and management of social networks.