The temporary research, development, and innovation loan is intended for SMEs and midcap-companies employing at least six people and operating in Finland and for foundations and associations doing significant business. Eligible for funding are those companies, foundations and associations that are through development seeking new means of coping with the disruptive circumstances in their businesses. By investing in development, applicants wish to improve their operating conditions and renew their businesses in order to be competitive in and after the covid-19 crisis.
Companies can apply temporary loan funding until the end of December 2020. (NOTE: The application period is extended until the end of December.) Project implementation may continue also after the deadline for applications.
Business Finland's financial authorization for this funding service is a maximum of EUR 300 million.
The funding is intended for limited liability (private and publicly listed) SMEs and mid-cap companies who are operating in international or domestic markets and whose businesses have been affected by the covid-19 pandemic. Foundations and associations with significant business may also apply for funding if their business has been affected by the covid-19. The applicant must be able to show Business Finland how the covid-19 crisis has hampered its business or what kind of a threat the crisis poses and how the applicant is trying to solve these challenges through development measures.
The aim of the funding is to help SMEs and midcap companies to maintain their R&D activities even in the event of disruption and to develop solutions that create a new competitive advantage after the crisis. With Business Finland's funding, applicants can direct the resources released as a result of an exceptional situation to development work and accelerate development. This will allow them to keep their staff employed during the crisis.
The funding may be used for two types of RDI projects:
1. For companies, foundations and associations operating in the Finnish and/or international market whose business has been impacted by covid-19 and which have identified clear development needs in their business operations as the result of the exceptional circumstances caused by covid-19.
2. For companies seeking international growth whose business has been impacted by covid-19 and that want to invest in research, development and innovation (RDI) activities during the exceptional circumstances in order to improve international competitiveness and the prerequisites for international growth.
In the service business, funding is targeted mainly at the so-called labor-intensive sectors. Typically, the business of a labor-intensive company does not require substantial tangible investments and the labor costs account for a large proportion of the company's expenditure. A labor-intensive company requires significant human resources for customer interactions. Due to the nature of the activity and for this reason, productivity growth in labor-intensive sectors is often slow, too. Prior to the covid-19 crisis, various solutions related to automation, digitalization, or time and place independence of service production have been less utilized or identified in labor-intensive businesses than in less labor-dependent sectors. A lot of human resources are needed for customer encounters, and in a crisis like the covid-19, companies have to consider how, for example, experiences, meanings, experiences and benefits can be produced for the customer in new ways.
The funding is intended in particular for companies, foundations and associations in the following sectors:
Eligible organizations must be of such a size that they are able to implement a development project worth at least EUR 150,000 and, eventually, repay the loan from business earnings.
The minimum loan for businesses in disruptive circumstances is EUR 100,000. The amount of the loan for a company, a foundation or an association operating in the domestic market may not exceed EUR 500,000, and the maximum amount of funding for projects of companies, foundations and associations seeking international growth will be assessed according to their needs.
Business Finland's loan covers 50-70% of the approved project costs, depending on the project type as described above. The company must cover 30-50 % of the costs through its own finances. The applicant must be able to prove to Business Finland that it has sufficient funds for the whole duration of the project. As Business Finland's funding is generally paid retrospectively, the funding receiver must first be able to pay the costs arising from the project itself.
The term of the loan is generally 7-10 years.
In general, it is possible to have three years during which no principal is repaid. In the case of loans to companies seeking international growth, the loan period is the same as in Business Finland's normal RDI funding.
At the beginning of the project, 30% of the loan can be granted for the project in advance. The rest of the funding is paid on the basis of the actual costs.
Loans are unsecured, so no collateral is required. If the project is delayed, fails, or produces results that cannot be used in business operations, you can ask Business Finland to amend the loan terms. Primarily, the recipient is offered more time to repay the loan. In some cases, the unpaid principal and interest on the loan can be converted to a grant in whole or in part. In other words, the loan does not need to be repaid. Read more about Business Finland´s loan funding and loan amendments.
The following are examples of how the company, foundation or association may use the funding:
Funded projects give rise to solutions that enable the organization to operate profitably and sustainably after the covid-19 crisis. The funded solutions should have significant employment impact in Finnish society.
The content and goals of a project determine which costs are eligible. Costs can be approved from the date when the application was sent to Business Finland.
Eligible costs are expenditure on research, development and innovation, which is
The salaries of the company's own personnel can be approved as costs in proportion to the amount of work done on the project, as well as the associated indirect personnel costs, overheads, and the services, machinery, and goods purchased in relation to the project. For a more precise breakdown of the eligible costs, see the terms and conditions of funding for companies' research and development projects.
The funding may not be used for a project for which the company has received development funding for disruptive business circumstances in grant form from Business Finland. However, a company that has received a grant may apply for temporary RDI loan funding to continue the development work (such as piloting or product development) that began on the grant project. Loan funding may also be granted alongside development funding in disruptive circumstances, but in such cases, the actions must concern different targets than the grant project.
Due to EU rules on state aid and other national restrictions, the funding cannot be used for:
You can amend/edit your application via the Online Services, so long at its current status is 'Under review'. You will not receive any separate notifications of the amendment of your application's status, but you can monitor it in the Online Service. Do not send your application again by email, even if the status does not immediately change to 'in progress' in the application service.
You can cancel your application by contacting the record office. Applications cannot be canceled in the Online Service. Your message must include the application reference number and your organization's name.