The year 2021 ends on December 31, and so does the deadline to apply for European aid managed by Cofides, the Spanish Development Finance Company. Of the €1 billion in European funds designated for the recapitalization of SMEs, more than €770 million remain unassigned. The clock is ticking, and there’s an incredibly important financial opportunity that businesses should not miss: they have less than two months to apply.
The Spanish government tasked Cofides with distributing this public capital, intended to rescue viable companies hit hard by the pandemic crisis. In four months, €226 million have been distributed, less than a quarter of the total. The European Commission’s deadline to request these funds is approaching at the end of the year. While Brussels could extend this deadline, it has not done so yet. So far, only 20 companies have completed the process established by Cofides and will soon receive the planned capital injection. The average aid amounts to around €11 million per company.
Cofides estimates that there are over 13,000 companies in Spain that meet the requirements to apply for these recapitalization funds. It would be an inexplicable failure not to utilize the €1 billion allocated by Europe, intended specifically to save companies that need funding to avoid closure. So far, only 37 companies have applied for assistance from Cofides, and of these, only 20 have passed the stages required to receive the funds. Where is the problem?
This European money for the recapitalization of SMEs is intended for companies that have an urgent need for financing but are viable in the medium term. Among other requirements, applicants must be up to date with tax payments, demonstrate a turnover between €15 million and €400 million, and show a revenue drop of at least 20% in 2020. However, it is proving that the application process is not easy and requires specialized advice for the proper preparation of the required reports. An additional requirement is a report endorsing the business’s viability.
The application review process for these European funds involves financial and legal consultants, including PKF Attest, a group allied with Kaizen Consulting in financing matters. This screening, conducted before aid is assigned, is complemented by ongoing monitoring from Cofides to ensure the proper use of funds and compliance with the terms imposed on beneficiary companies.
Kaizen Consulting advises all companies interested in this financial injection to seek advice to successfully formalize their application. So far, only two applications from companies in the Valencian Community have been accepted. Clearly, many more SMEs meet the criteria to benefit from European recapitalization. We specialize in managing these aid processes and can assist interested companies throughout the entire process, from application to completion. We hope they seize this opportunity to overcome the crisis.
If you have any questions about this matter, contact us, and we will personally review your case.
