PUBLIC CALL ANNOUNCED:
Capital for Development 2026 – Subsidised Loans at 2% Interest

1. Who is the programme for? (Target beneficiaries)

The "Capital for Development 2026" programme is strategically designed to broaden access to low-cost capital for companies seeking to modernise their operations, expand capacity, and strengthen core liquidity.

Eligible beneficiaries are:

• Micro and small enterprises,
• Sole proprietors (Entrepreneurs),
• Cooperatives (fully compliant with statutory legislation, having completed a cooperative audit within the last two years).

Key Registration Condition: All applicants must have been registered with the Serbian Business Registers Agency (APR) on or before 31.12.2024. In practice, this means enterprises must possess a proven trading history and have submitted approved annual financial statements for 2025, which serve as the official benchmark to determine enterprise size. Furthermore, applicants must be in majority private ownership. Medium-sized and large enterprises are excluded from this Public Call and cannot apply.

Prime Opportunity for the Hotel and Hospitality Sector

While the programme maintains a strict list of ineligible activities (such as primary agriculture, wholesale/retail trade without value-added processing, financial services, and property development), the hotel, restaurant, and catering sector (accommodation and food services) is fully eligible. Hotel developers and operators can utilise these concessional funds to finance kitchen refits, state-of-the-art HVAC ventilation and climate systems, luxury spa and wellness centres, or secure permanent working capital to maintain seamless operational liquidity.

2. What is eligible for financing and what is excluded? (Eligible purposes and restrictions)

All funded investments must directly correspond to the registered core activity or proven genuine business operations of the economic entity. The programme clearly distinguishes between two dedicated loan facilities:

A. Procurement of New Equipment

• ✓ Loan Amount: From RSD 700.000 to RSD 15.000.000.
• ✓ Own Equity Contribution: A minimum of 30% of the net value stated on the proforma invoice (proforma invoices must be dated after the official announcement date of the public call).
• ✓ Repayment Tenor: Up to 60 months, including a grace period of up to 6 months.
• ✓ Interest Rate for Borrower: Fixed at 2,00% per annum (with no foreign currency indexation clause).
• ✓ Eligible Ancillary Costs: Total eligible investment value may include VAT, freight, delivery, assembly, installation, and staff training costs, provided they are explicitly itemised on the supporting proforma invoices.
• ✕ Ineligible Expenditure: Equipment cannot be purchased from private individuals, unless the vendor is registered as a sole proprietor (entrepreneur). In addition, customs duties, import tariffs, and secondary overheads not itemised on the proforma invoice are ineligible for subsidisation.

B. Permanent Working Capital

• ✓ Loan Amount: Working capital loans are approved up to RSD 15.000.000 to finance ongoing operating expenditures, raw material inventories, and core liquidity.
• ✓ Own Equity Contribution: No mandatory equity contribution is required (0%).
• ✓ Repayment Tenor: Up to 36 months, including a grace period of up to 6 months.
• ✓ Interest Rate for Borrower: Fixed at 2,00% per annum (with no foreign currency indexation clause).
• ✓ Hospitality: In the hotel and catering industry, "permanent working capital" represents the baseline operational liquidity a hotel must permanently maintain to sustain uninterrupted services throughout the year regardless of seasonal fluctuations.
• ✕ Ineligible (in Trading Activities): For businesses registered under wholesale or retail trading activity codes, working capital loans can be approved only if there is proven value-added processing (standard resale of goods without alteration is strictly excluded).

When combining both loan applications, the following structural rules apply:

1. Equity Contribution and Tenor:
   • Equipment Facility: Requires a mandatory equity contribution of at least 30% of the investment value, with a repayment tenor of up to 60 months (including a 6-month grace period).
   • Permanent Working Capital Facility: Requires zero equity contribution (0%), with a repayment tenor of up to 36 months (including a 6-month grace period).
2. Collateral Structuring:
   • For New Equipment: Security is primarily established via a pledge over the newly acquired machinery along with company and personal promissory notes, meaning real estate mortgages are generally not required.
   • For Working Capital: For amounts exceeding RSD 2.500.000 (for sole proprietors and micro-entities) or exceeding RSD 6.000.000 (for small legal entities), the commercial bank requires a 1st-rank real estate mortgage or equivalent prime liquid security.
3. Regulatory Limits and State Aid Ceilings:
   • Maximum Subsidy Amount: The cumulative non-repayable grant value (interest rate subsidy and 0,5% bank fee) cannot exceed RSD 15.000.000 per single applicant.
   • De Minimis Ceiling: Total state aid received over the 2024–2026 rolling three-year period must not exceed €300.000 in dinar equivalent.

SEECAP's Role in Dual Applications: Submitting two parallel credit dossiers carries heightened risks of procedural discrepancies and non-compliance with rigorous bank and ministerial standards. The SEECAP team structures both applications into a coherent, bankable financing package. We synchronise the business plan, cash flow projections, collateral allocation, and de minimis calculations, ensuring expedited processing without delays.

Key Constraints, Rules, and Eligibility Conditions

• Tax Clearance Certificates (Crucial Elimination Condition): Certificates confirming that all due public revenue obligations have been settled (issued by the Tax Administration of the Ministry of Finance and the relevant local tax administration) must be issued STRICTLY AFTER the official announcement date of the Public Call. Tax clearance certificates dated prior to the call announcement are deemed invalid and result in automatic disqualification.
• Foreign Exchange Exposure: If equipment is imported from abroad, any negative exchange rate movements between invoice issuance and final settlement are borne exclusively by the borrower.
• Prohibition of Double Financing: The identical investment project must not be financed by or submitted to any other public or state aid scheme in 2026.
• De Minimis Aid Ceiling: The total cumulative state aid (grants and subsidies) received by the enterprise across the 2024–2026 rolling three-year period must not exceed the statutory ceiling of €300.000.
• Connected Persons and Group Thresholds: The applicant must "not belong to a corporate group affiliated with a medium or large legal entity" (domestic or foreign/EU). If a local micro or small company is owned by or consolidated with a medium or large entity, it is disqualified. For businesses with foreign parents, this requires rigorous consolidated financial analysis. Below are the statutory thresholds:
  • Serbia – Under the Law on Accounting of the Republic of Serbia (Article 6), legal entities are classified based on regular annual financial statements for the preceding fiscal year (for 2025). A company loses small status and is considered medium or large if, at the balance sheet date, it exceeds at least two of the three criteria for small entities:
    1. Average workforce: More than 50 employees during the financial year (for large entities: >250).
    2. Annual operating turnover: In excess of €8.000.000 in RSD equivalent (for large entities: >€40.000.000).
    3. Total balance sheet assets: In excess of €4.000.000 in RSD equivalent (for large entities: >€20.000.000).
  • European Union – (Directive EU 2023/2775): On a consolidated level, an enterprise ceases to be small if it exceeds two of the following three criteria:
    1. Average workforce: more than 50 employees (for large: >250).
    2. Net turnover: in excess of €10.000.000 (for large: >€50.000.000).
    3. Total assets: in excess of €10.000.000 (for large: >€25.000.000).

3. Financial framework and subsidy mechanism

The total state budgetary allocation for the programme stands at RSD 2.000.000.000, apportioned equally between two dedicated tracks:

1. RSD 1.000.000.000 dedicated to new equipment procurement.
2. RSD 1.000.000.000 dedicated to permanent working capital.

Universal Facility Parameters:

• Individual Facility Amount: From RSD 700.000 up to a maximum of RSD 15.000.000.
• Cumulative Limit for Dual Applications: Up to RSD 30.000.000 (combining one new equipment loan and one permanent working capital loan).
• Currency: Exclusively Serbian Dinar (RSD) loans with no foreign currency clause. This provides a decisive competitive advantage during periods of currency volatility, completely eliminating FX risk for your business.
• Loan Processing Fees: Capped at a maximum bank fee of 0,5%, which is 100% subsidised by the Ministry of Economy.

Important: Each enterprise may submit a maximum of one application for each of the two facility types (one for equipment and one for working capital), securing a COMBINED TOTAL OF UP TO RSD 30.000.000.

How Does the Subsidised Interest Rate Mechanism Work?

Rather than distributing upfront cash grants, the Ministry of Economy directly subsidises the commercial bank's lending rate so that the end borrower pays a fixed annual interest rate of just 2%.

The operational mechanics are structured as follows:

Note: For equipment loans, given the mandatory 30% borrower equity contribution, applying for the minimum loan of RSD 700.000 requires a total equipment investment package of at least RSD 1.000.000 to meet statutory eligibility thresholds.

4. Collateral and security instruments

Collateral requirements frequently represent the greatest hurdle in government-backed credit lines. Under the Capital for Development programme, security requirements are calibrated as follows:

For New Equipment Acquisition:

• Company promissory notes (blank solo notes).
• Personal promissory notes from all beneficial owners holding >25% equity ownership.
• Pledge over the newly acquired equipment (meaning real estate mortgages are generally not required for this facility).

For Permanent Working Capital:

• Company promissory notes and personal promissory notes from owners with >25% shareholding.
• Additional Real Estate Collateral: For loan amounts exceeding RSD 2.500.000 for sole proprietors/micro-enterprises, or exceeding RSD 6.000.000 for small legal entities, a 1st-rank commercial or residential real estate mortgage (or other prime liquid collateral) is mandatory.
• Partner commercial banks maintain the discretion to request supplementary security in accordance with their internal credit underwriting policies. Early loan repayment is permitted in accordance with the credit agreement.

5. What if the official APR activity code differs from actual operations?

Many dynamic enterprises generate significant revenue from profitable activities that do not correspond to their registered primary activity code in the APR. The Ministry of Economy has explicitly accounted for this reality, allowing applicants to prove their genuine business operations for which investment funding is sought.

To substantiate actual operations prior to loan application, businesses must prepare the following evidentiary package:

1. Photographic Evidence: High-resolution photos of operational production facilities, commercial kitchens, manufacturing lines, or hotel equipment in active service.
2. Fixed Asset Ledger: Analytical fixed asset register as of 31.12.2025., clearly identifying and detailing the operational equipment utilised in that business segment.
3. Sales Invoices: A minimum of three commercial sales invoices issued to independent, non-affiliated corporate customers over the preceding two years.

6. Application procedure: "One application, two decisions"

The administrative procedure is actively underway and is structured through the following steps:

1. Public Call is Announced: The Ministry of Economy has officially published the public call. Applications are received until 09 October 2026 or until the budget of RSD 2.000.000.000 is exhausted.
2. Simultaneous Bank Submission: The applicant submits a single unified dossier to the partner commercial bank, comprising both the commercial credit application and the grant request for the interest rate subsidy.
3. Bank Underwriting: The commercial bank performs credit analysis, verifies statutory criteria, and confirms documentation completeness.
4. Ministry Decision: The bank forwards compliant applications to the Ministry of Economy, which issues formal decisions granting the subsidy strictly in the order received.
5. Contracting and Disbursement: Following the Ministry's decision, tripartite agreements and bilateral loan contracts are executed, and the bank disburses the funds.

Frequently Asked Questions (FAQ)