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Key promotional area: Start-ups and general corporate finance – business sector Mittelstandsbank (SME Bank)

Start-ups very important for national economy

With their courage to become self-employed and launch new products and services, start-ups drive development, stimulate competition and create jobs. KfW offers start-ups and young businesses a range of different financing programmes as well as comprehensive advice as a means of promoting start-up activity in Germany.

KfW recognises successful start-ups

Current trend

The sustained strength of the labour market significantly curbed Germany’s start-up activity in 2016, with the number of start-up entrepreneurs down year-on-year by 91,000, or 13%, to 672,000 persons.

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Succession programme

Corporate succession a challenge for SMEs

Demographic change is raising concerns that corporate succession will suffer notable losses in the near future. On the one hand, more small and medium-sized enterprises (SMEs) seek successors every year. The succession exchange platform nexxtChange helps them in this endeavour. On the other hand, Germany's historically healthy labour market situation is causing start-up activity and thus successor potential to decline considerably. Delays or failure in business transfers puts investment, competitiveness and jobs under pressure.

High demand for successors in SMEs

Around 620,000 companies and thus some 17% of SMEs employing over 4 million people plan to hand over or sell their business to a successor by 2018.

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Corporate succession – current financing offers for businesses and entrepreneurs

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Internal or external succession: family members/employees/external individuals as start-up entrepreneursExternal succession: established business
Loan programmeERP Loan – StartGeldERP Capital for Start-UpsERP Start-Up Start-Up Loan UniversalKfW Entrepreneur Loan
ApplicantPrivate individuals Small enterprises up to 5 yearsPrivate individuals for projects in SMEs up to 3 yearsPrivate individuals Companies up 5 yearsCompanies from 5 years
Maximum loan amountEUR 100 thou. per applicantEUR 500 thou. per applicantEUR 25 m per projectEUR 25 m per project
Share of financingUp to 100%30% (western states) 40% (eastern states) subordinated loansUp to 100%Up to 100%
Exemption from liability80% obligatory100% obligatory50% possible*50% possible
Commitment volume 2016EUR 270 mEUR 117 mEUR 3,245 mEUR 5,811 m

* For investments of companies older than three years

KfW Entrepreneur Loan – flexible programme for SMEs

The KfW Entrepreneur Loan is a good solution for a wide variety of established SMEs’ financing requirements. KfW committed a volume of more than EUR 5.8 billion in 2016.

The first financing partners Deutsche Bank and Postbank have been using the BDO platform to make digital promotional loan commitments since 1 September 2016.

The platform provides advisors at these banks with a complete online process to finance SME customers, from application for the KfW Entrepreneur Loan, through an automatic check of promotional capacity, to an immediate and binding promotion commitment. This reduces customers' waiting time for a promotion commitment from what was previously several banking days to a few seconds.

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Legal notice:
The information contained in this online Annual Report 2016 is based on KfW’s Financial Report 2016, which you can download here. Should this online Annual Report 2016, despite the great care taken in preparation of its content, contain any contradictions or errors compared to the Financial Report, the KfW Financial Report 2016 takes priority.

KfW Stories

The digital magazine of KfW tells stories from all over the world: about inventors, building owners and entrepreneurs, about people in the spotlight and people in the shadows, about ecology and about growth.

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