There are various types of financial instruments
equity and debt
loan guarantees and venture capital
capacity building and risk sharing facilities
For example, the EU provides loans to businesses of all types for investment in research and innovation. It also provides guarantees to help beneficiaries to obtain loans more easily or at better conditions from banks and other lenders. The EU may also financially participate in a project by owning parts of it. Financial instruments can also be combined with grants.
Financial instruments are implemented in partnership with public and private institutions such as banks, venture capitalists or angel investors. These ﬁnancial institutions determine the exact ﬁnancing conditions – the amount, duration, interest rates and fees.
The applicant receiving funds through EU financial instruments must allow the intermediary financial institution to conduct their due diligence, including on-the-spot checks and inspections. Failure to comply will result in financing being delayed or denied.