Action 3 – Cutting-Edge Digital Transformation of SME

As part of the new "NSFR program 2021-2027," Action 3 - Digital Transformation of SMEs focuses on supporting businesses that have already integrated ICT in many of their operations and now seek to implement integrated investments in cutting-edge technologies or solutions of the 4th Industrial Revolution.

The Total Budget - Public Expense amounts to 60,000,000€, distributed per Region as follows:

Attica & South Aegean: 13,200,000€
Other regions: 46,800,000€.

The Action in details

Funded Budget

The Funded Budget of the business plans that will be submitted, can range from €200,001 to €1,200,000.

Beneficiaries of Actions

Beneficiaries eligible for support from the Action are Very Small, Small, and Medium Enterprises, which, among others, should:

Have completed at least one (1) full managerial utilization.
Have at least nine (9) Full-Time Equivalent (FTE) employees throughout the calendar year, preceding the application submission.
Submit a responsible declaration of securing private co-financing of at least 25%.
Achieve a minimum score of 70 in the digital maturity questionnaire.
Not have initiated any work on the investment project before the submission of the support application.
Operate in at least one (1) of the eligible NACE (as included in Annex IV of the Action's invitation) and have been doing so for at least one (1) year.
Not have initiated any work on the investment project before the submission of the funding application. It should be noted that cohabitation of businesses is not allowed, so that the equipment and/or software of the supported investment are not used by another enterprise. The term "cohabitation" refers to the installation of the supported enterprise on the same premises with another enterprise. In case of cohabitation, the Inclusion decision is revoked.

It is noted that the complete participation requirements for beneficiaries are presented in detail in the Action's Invitation.

Eligible expenses

The expenses covered by Action 3 concern the acquisition of:

Equipment Expenses (indicative): Procurement of advanced remote operation systems for facilities, automation of various stages of the value chain (production - transportation - storage), production / storage / transportation using robotic systems, upgrading of internal data transport networks, etc.
Software Expenses (indicatively): Procurement of applications for enhanced intelligent administrative and financial programming, digital security, customer and supply chain management, data analysis using artificial intelligence tools, production optimization, upgrading of provided services, etc.
Expenses for Services related to Digital Upgrading (indicatively): Consulting and technical support for configuring and integrating new systems into SME operations, system certification, etc.

Subsidy Rates

The rate of Public Funding (subsidy) ranges from 25% to 50% depending on the support regime, the Region of the country, the size of the enterprise, and the eligible expenditure. For applications submitted in the Just Transition Regions (Regions of Western Macedonia, Northern Aegean, Southern Aegean, Crete, and the Municipalities of Megalopolis, Gortynia, Tripoli, Oichalia), the public funding may reach up to 60% of the Financing Request's budget.

Support Regime

The Action provides the option to choose between the support regimes implemented under Regulations EU 651/2014 (GAC) or EU 1407/2013 (De Minimis) as applicable. The enterprise can select one of the two regimes for the submission of its financing request. The choice is mandatory for the application submission.
This Action concerns the financial support of SMEs of any activity, provided that they do not fall within the restrictions of the financial regimes (GAC or De Minimis). The applied support regimes are Regulations EU 651/2014 (GAC) or EU 1407/2013 (De Minimis) as applicable. The enterprise can choose one of the two regimes for the submission of its financing request. The choice is mandatory for the application submission. It should be highlighted, that the eligible sectors of activity, eligible expenses, and the evaluation process of investment plans are common elements for both regimes.
In case the support regime of Regulation EU 1407/2013 is chosen, the total amount of De Minimis aid received in the past by the specific enterprise (single undertaking), including the aid received from this Action, must not exceed €200,000 (or €100,000 for the road freight transport sector for hire or reward) within a three-year period (current financial year and the two previous financial years before the time of granting the legal right to the support).

It is also noted that the investment projects to be submitted under the financial regime of Regulation EU 651/2014 (GAC) should be of initial investment nature and specifically meet one of the following criteria:

Creation of a new business establishment.
Expansion of the capacity of an existing unit. The additional capacity of the unit due to the investment project can be accepted only if the existing capacity of the unit can be certified by official supporting documentation.
Diversification of the production of a unit into products or services that have never been produced by it, under the condition that for the support that’s granted to large enterprises or SMEs for the diversification of an existing establishment, the eligible expenses exceed at least 200% of the book value of the reusable assets as registered in the financial year preceding the start of the works.
Fundamental change of the entire production process of an existing unit.

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Regarding the coverage of private participation in the investment project:

Provision of a letter of intent/pre-approval for a loan to cover a portion of the private participation.
The private participation can be covered either from own capital of the beneficiary or through bank borrowing. The beneficiary's participation in the total eligible cost of the investment project can be made either through own funds (equity participation) or through external financing, provided that twenty-five percent (25%) of it does not include any element of state aid.
The investment loan can be granted in foreign currency. The bank loan should take the form of a bank loan or a bond loan issued in public or private placement, or a loan from other financial institutions, excluding mutual accounts. The movement of the upper loan can also be made through a mutual account, if there is a separate agreement in the account, stating that the loan is intended for the implementation of the investment, with a clear reference to the terms of the loan agreement. In any case, if the enterprise resorts to borrowing to cover the financial scheme of the investment, it is obliged to submit a copy of the relevant contract with the necessary additional actions, if the movement of the loan takes place through an open mutual account.
Debit interest, financial transaction fees, foreign exchange costs, and other net financial expenses of the beneficiary are considered operational expenses and are not eligible.
In case the investment plan falls under Regulation EU 651/2014, it is required, during the submission of the funding application, to demonstrate that the Private Participation (own funds and/or external financing) in the proposed budget of the investment project, amounts to at least twenty-five percent (25%) of it and must not include elements of state aid.

What happens after the decision of inclusion?

You can apply to the Bank for the provision of a long-term loan to cover part of the private contribution, if provided. You can also apply for the provision of a short-term loan to finance all or part of the subsidy with the transfer of the latter to the bank.

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