Have you won a grant from the European Innovation Council (EIC)? Then you are probably wondering how grant payments are scheduled, when exactly you get the money and what you need to do to receive it. Let us explain.
A special feature of the EIC Accelerator is that funding is provided in the form of mixed support, combining a grant component and an equity component.
The grant is non-refundable, and can reach up to €2.5 million. The grant is not paid all at once but follows a specific payment plan. The Grant Agreement (GA) sets three tranches: two pre-financing payments paid within the project lifetime, and a third final payment of the balance after the end of the project.
The first pre-financing occurs just before or shortly after the start of the project and it is up to 55% of the fund amount agreed in the GA.
Additionally, 5% of the amount is transferred to the Guarantee Fund where it is retained until the end of the project. The Guarantee Fund covers financial risks, including amounts potentially owed by the beneficiary. At the end of the project, this amount is returned to the company as a part of the final payment.
The second pre-financing is paid 2 months after the end of the first project period (which is typically 12 months) and is disbursed after approval of the interim report.
The second payment can be at most 30% of the grant amount. But no matter the amount fixed in your GA, the rules say that the company will only receive the maximum second pre-financing if at least 76% of the first pre-financing has been used. If you use less than 76% of the first pre-financing, the amount of the second pre-financing will be reduced by the difference between the 76% threshold and the amount used. In such a case, the second payment will be less than 30% of the grant amount.
FINAL (BALANCE) PAYMENT
The last payment is transferred after approval of the final reports. This payment is calculated as the total grant amount (based on eligible costs) minus the amount already paid by the EIC in the two pre-financing payments.
The total payment is limited to the maximum EU contribution agreed in the Grant Agreement. If the total amount already paid is higher than the agreed contribution, the EIC will recover the difference.
Additionally, at this stage the 5% from the Guarantee Fund is returned to the beneficiary.
All payments are made to the SME’s bank account established in the Grant Agreement, using the Euro as currency.
In summary, the standard payment schedule for a €2.5M grant would work as follows:
|First pre-financing||55% of the grant amount||1 375 000||If GA signed before project start: not earlier than 10 days before the project start and no later than 20 days after the project start If GA signed after starting date: within 30 days after signature||GA signed|
|Second pre-financing||30% of the grant amount||750 000||60 days after receiving the request (usually in month 14 of the project)||Paid in full only if at least 76% of the first pre-financing has been used|
|Balance payment||15% (10% of the total grant + 5% released from Guarantee Fund)||375 000||After project end; 90 days after receiving
the final report
|Project completed; final report approved|
Do you need support to prepare the cash flow for your EIC project? We can help! email@example.com