Financial instruments (FIs) co‑funded by the European Structural Investment Funds (ESIF) are a sustainable and efficient way to invest in growth and development in EU regions and cities. They can support a broad range of development objectives to the benefit of a wide range of final recipients (FRs) with the potential for EU funds to lever in additional public and private contributions and/or to be reused for further investments.
The 5 European Structural and Investment Funds may be used to support FIs under one or more programmes, including when organised through funds of funds, in order to contribute to the achievement of specific objectives set out under a priority. When using ESI Funds, Managing Authorities (MAs) may implement FIs (or Prizes, Grants or Repayable Assistance). The choice of FI and of financial products must be determined in the ex‑ante assessment.
FIs under the European Structural and Investment Funds are EU measures of financial support provided on a complementary basis from the budget in order to address one or more specific policy objectives of the EU. Such instruments may take the form of equity or quasi-equity investments, loans or guarantees, or other risk-sharing instruments, and may, where appropriate, be combined with grants.
The choice of the financial products will depend on the market failures, suboptimal investment situations and investment needs to be addressed as well as the acceptable level of risk, reward and ownership. MAs can tailor financial products according to their needs and capabilities or structure the FI based on terms and conditions provided by the Commission.
FIs can support projects by providing four main financial products:
* European Commission (2015). Guidance for Member States on FIs – Glossary.
More information can be found on Innova-FI Booklet " What are Financial Instruments" in our library. Check out: https://www.interregeurope.eu/innova-fi/library/#folder=1668!