COSME Factsheet

COSME Financial Instruments

The programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME) is improving access to finance for SMEs through two financial instruments that have been available since August 2014.


COSME has a budget of over €1.4 billion to fund these financial instruments that facilitate access to loans and equity finance for SMEs where market gaps have been identified. COSME financial instruments are complemented by resources from the European Fund for Strategic Investments (EFSI).

Thanks to this budget, it will be possible to mobilise up to €35 billion in financing from financial intermediaries via leverage effects. The financial instruments are managed by the European Investment Fund (EIF) in cooperation with financial intermediaries in EU countries.


The Loan Guarantee Facility (LGF):

Part of the COSME budget will fund guarantees and counter-guarantees for financial intermediaries (e.g. guarantee organisations, banks, leasing companies) to help them provide more loan and lease finance to SMEs. This facility will also include the securitisation of SME debt-finance portfolios.

By sharing the risk, the COSME guarantees will allow financial intermediaries to expand the range of SMEs and types of financial transactions they can support. The impact is substantial – due to the leverage effect, every euro invested in a loan guarantee is expected to release up to 30 euros of financing for SMEs. These guarantees will help many SMEs who might otherwise not be able to obtain funding due to their perceived higher risk or a lack of sufficient collateral.

It is expected that up to 500,000 SMEs will receive loans backed by COSME guarantees, with the total value of lending being over €30 billion.

The COSME financial instruments build on experience from the financial instruments under the Competitiveness and Innovation Framework Programme (CIP) that ran from 2007 to 2013. Since 2007, more than 340,000 SMEs have benefited from a guaranteed loan or lease thanks to the SME guarantee facility (SMEG). Based on the results of that programme, it is expected that under COSME, 90% of beneficiaries will have 10 or fewer employees with an average guaranteed loan of about EUR 65,000. This is the category of SMEs who currently face the most difficulty obtaining finance.

A call for expression of interest for financial intermediaries is open until 30 September 2020. Financial intermediaries wishing to apply to the LGF can find more information on the EIF website.


The Equity Facility for Growth (EFG):

Part of the COSME budget is dedicated to investments in risk-capital funds that provide venture capital and mezzanine finance to expansion and growth-stage SMEs, in particular those operating across borders.

Fund managers working on a commercial basis will ensure that investments are focused on SMEs with the greatest growth potential.

It is expected that some 300 firms will receive equity financing through the programme, with overall investment reaching up to €2.54 billion. It is also anticipated that further finance will be attracted through co-investments from other public and private sources.

The COSME equity financial instrument builds on the experience of the equity financial instrument under the Competitiveness and Innovation Framework Programme (CIP) that ran from 2007 to 2013. From 2007 to date, the equity financing facility under CIP (the so-called GIF facility) has mobilised more than €2.3 billion in equity investments.

A call for expression of interest is open until 30 September 2020. Financial intermediaries wishing to apply can find more information on the EIF website.

How to access the COSME financial instruments

If you are an SME or an entrepreneur looking for debt or equity finance and would like to see which financial intermediaries are working with COSME, please visit Access to finance portal.

The ‘EU financing – real benefit for businesses’ brochure provides information on the COSME/EFSI results as of December 2018, as well as case studies highlighting the diversity of projects and businesses supported. More case studies can be found here and on the EIF website.

If you are a financial intermediary, you can find more information on the calls for expression of interest for the COSME financial instruments:

Other European Commission initiatives to improve SME access to finance

This website above gives tips on (a) Funding opportunities, (b) Tips for Applicants and Beneficiaries, & (c) Communication tool kit. It also covers Erasmus for Young Entrepreneurs, European Cluster Collaboration platform, Enterprise Europe Network (EEN) etc