KfW Mittelstandsbank

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Unternehmerkapital (Entrepreneur Capital)

A family of products for business start-ups, self-employed professionals, young and established enterprises

Under its Unternehmerkapital programme KfW Mittelstandsbank offers you long-term subordinated loans.

Subordinated loans are characterised by the fact that the lender's claims are junior to those of all other debt capital providers, which gives the loans quasi-equity character. As a rule, no collateral is required. Take note, however, that final borrowers are personally liable as natural persons for the repayment of the loan. In this way, subordinate loans pool the advantages of debt and equity capital, thus improving a company's credit standing and making it easier for it to access additional funding.

Why is Unternehmerkapital a family of products? Every business goes through various stages of development. Accordingly, Unternehmerkapital is composed of the following building blocks.

• ERP Capital for Start-ups (Programme number 058) for business start-ups and young entrepreneurs up to a period of 3 years after the start of business
• Start-ups receive loans at interest rates reduced from the ERP Special Fund.
• KfW Capital for Work and Investment (Programme number 054 or 055 or 064) for established enterprises that have been in business for at least 3 years.

Subordinated loans granted to established enterprises carry different interest rates depending on the applicant’s credit standing. Enterprises with a good credit standing will benefit from low interest rates, whereas weaker companies still have access to capital but at risk-adjusted interest rates.

Both elements of the Unternehmerkapital have in common that the banks are relieved from the risk of a possible loss of the subordinated capital. This risk is assumed either by the Federal Government or by KfW Mittelstandsbank.

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Further information

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