Small and Medium-sized Enterprises (SMEs) are the backbone of Europe’s economy, providing 85% of all new jobs. The European Commission aims to promote entrepreneurship and improve the business environment for SMEs, to allow them to realize their full potential in today’s global economy.
COSME is the EU programme for the Competitiveness of Enterprises and SMEs, running from 2014 to 2020, with a budget of €2.3billion. COSME will support SMEs in the following areas:
- Facilitating access to finance
- Supporting internationalisation and access to markets
- Creating an environment favourable to competitiveness
- Encouraging an entrepreneurial culture
COSME is a programme implementing the Small Business Act (SBA) which reflects the Commission’s political will to recognise the central role of SMEs in the EU economy.
Aims of the programme COSME
- to make it easier for small and medium-sized enterprises (SMEs) to access finance in all phases of their lifecycle – creation, expansion, or business transfer. Thanks to EU support, businesses have easier access to guarantees, loans and equity capital. EU ‘financial instruments’ are channelled through local financial institutions in EU countries.
- to support actions to improve the framework conditions in which enterprises operate, in particular SMEs, by reducing unnecessary administrative and regulatory burdens. Such actions may include measuring the impact of relevant Union law on SMEs, developing smart and business friendly regulation for them and reinforcing the use of the “Think Small First” principle for policy-making at national and regional level.
- to support the emergence of competitive industries with market potential, by helping SMEs to take-up new business models and integrate into new value chains. The programme complements the actions of Member States in areas with high growth potential such as the tourism sector.
- to promote the development of world-class clusters in the EU, fostering cluster excellence and internationalization with an emphasis on cross-sectoral cooperation, notably in support of emerging industries.
The programme also aims at accelerating the digitalization of the business community and promoting e-skills and e-leadership.
One of COSME’s main objectives is to provide enhanced access to finance for SMEs in different phases of their lifecycle: creation, expansion or business transfer. In order to achieve this objective, the EU will mobilise loans and equity investments for SMEs.
Through the Loan Guarantee Facility, the programme will provide guarantees and counter-guarantees to financial institutions (e.g. guarantee societies, banks, leasing companies) so they can provide more loan and lease finance to SMEs. It is expected that COSME will enable between 220 000 and 330 000 SMEs to obtain financing for a total value of between €14 and €21 billion.
Through the Equity Facility for Growth, the programme will provide risk capital to equity funds investing in SMEs mainly in the expansion and growth-stage phases. The Facility should help between 360 and 560 firms to receive equity investment with an overall volume invested ranging from € 2.6 to € 4 billion.
COSME supports entrepreneurs by strengthening entrepreneurship education, mentoring, guidance and other support services. Actions support specific groups who may find it difficult to reach their full potential, such as young people, women and senior entrepreneurs.