Loans to non-repayable fund: what they are and how to apply for them

What are non-repayable loans?

What are non-repayable loans?

Non-repayable loans are subsidized loans that are usually paid to startups or to young and female entrepreneurs. However, it may happen that they are also granted to already consolidated companies if they operate in strategic sectors or to companies located in disadvantaged territorial areas.

The peculiarity of these loans is that they are granted without repayment obligation. The capital disbursed, or a part of it, in fact is not subject to repayment in installments or interest. So it is a sort of investment that the public body or institution makes with the aim of promoting and promoting economic development and self-employment.

There are different types of non-repayable loans, each dedicated to a particular category of applicants and granted by a specific institution. These are concessions designed for young entrepreneurs and for those who want to open a business, granted thanks to European, state or regional funds.

Here is a simple definition of non-repayable loans.

Who are the recipients?

Who are the recipients?

Non-refundable loans are aimed at the following categories:

  • those who want to open a business or start a start-up;
  • young people, aged between 18 and 35;
  • the unemployed, to start a business;
  • female entrepreneurship;
  • to help and encourage certain areas considered to be most disadvantaged in terms of competitiveness;
  • even large companies can access this form of credit as long as they invest in certain strategic and public interest sectors, such as renewable energy.

What are the requirements to access?

What are the requirements to access?

The notices for obtaining non-repayable financing are indicated in the calls, however, in general, they are as follows:

  • educational qualification or technical skills related to the objective of the call;
  • corporate form;
  • specific requirements of the call;
  • ability to create a strategic marketing project for your business.

Who grants non-repayable loans?

Who grants non-repayable loans?

The non-refundable contributions come from public, European, state or regional bodies, which provide them in order to encourage the development of entrepreneurial activities in the area.

Calls are issued periodically for particular categories of new entrepreneurs. By filling in the appropriate application and attaching a business plan it is possible to participate in the calls.

Please note that non-repayable loans can be combined with other concessions, even if obviously not within the same call. A start-up that has managed to access grants to face the birth phase, will be able to participate in further calls in the future if it meets the necessary requirements

How to apply for non-repayable loans?

How to apply for non-repayable loans?

In order to request (and obtain) non-repayable loans, it is necessary to consult the various calls, from which you can find the information necessary to evaluate the hypothesis of requesting the financing in question.

It is important to consider the different types of loans as each call has its own request characteristics.

Calls are divided into:

  • always open calls;
  • calls for deadlines;
  • active calls for the whole region;
  • calls active only in certain areas;
  • calls by sector;
  • calls for types of intervention.

What are the necessary documents?

What are the necessary documents?

Most of the calls are managed by Capital lender, the national agency for the attraction of investments and business development. To access it, it is necessary to complete the online application by registering on the website.

The documents to be submitted to request a non-repayable loan are the following:

  • the business plan, which contains the economic and financial information of the territory in which the company starts;
  • the objectives to be pursued in the short and medium-long term;
  • the expenses to be incurred using the tender money.

The questions will be analyzed according to the chronological order in which they received the Agency. The evaluation phase, if the project is deemed interesting, may also follow an interview with the person who submitted the application, to verify the potential and solidity of the proposed strategy.

Non-repayable loans: pros and cons

Non-repayable loans: pros and cons

Unsecured loans are undoubtedly an excellent opportunity for young entrepreneurs since the loan is not tied to repayment or interest. So especially for those who are starting out and want to open a business despite having low liquidity, having the ability to access subsidized credit formulas is essential.

There are however disadvantages :

  • limited availability,
  • waiting times, often very long.