The Economic Affairs Ministry provides SMEs with grants and low-interest loans so that they can finance their research and innovation activities more easily. New scientific findings are to be translated into marketable products as soon as possible. This is why the Ministry provides strong incentives for companies to cooperate with research institutes.

Research and innovation projects that are close to the market

Under the Central Innovation Programme for SMEs (ZIM), grants are provided for market-oriented technology research and development projects undertaken by German SMEs.

The ERP Digitisation and Innovation Programme provides funding for digitalisation and innovation projects and helps innovative companies to finance investments and new equipment. The aim is to enable innovative commercial companies, own-account workers and freelancers in Germany to access finance for projects in Germany at attractive interest rates. The financing partners passing on the loans (banks and savings banks) are offered an optional 70% liability release for loans. A grant is offered in addition to the loan (ERP Digitisation and Innovation Loan).

The ‘ERP Mezzanine for Innovation’ funding programme provides long-term and low-interest financing for market-related research and the development of new products, processes and services, and for important advancement work on these products, processes and services based in Germany. The programme gives established SMEs access to financing packages consisting of debt capital and subordinated loans (ERP Mezzanine Financing for Innovation).

Pre-competitive research

In order to hold their own in the international race to innovate, SMEs need to have access to research facilities whose R&D efforts are tailored to their needs and whose findings can be quickly and efficiently translated into marketable products and services. The Federal Ministry for Economic Affairs and Climate Action provides funding for pre-competitive research under its collective research programme (IGF). The results achieved under this programme benefit all companies in Germany. Under the INNO-KOM programme, funding is provided for non-profit research establishments that undertake applied research projects in structurally weak areas in Germany. Find out more (in German).

Advising companies on innovation

The German government provides SMEs with advice on innovation, helping them to build up expertise in developing new innovations. This means for example that companies receive information on how to manage innovations in an effective manner and on what funding programmes are available at national, regional and EU level.

  • The Federal Ministry of Economics and Climate Action’s Innovation Vouchers (go-inno)
    The Federal Ministry for Economic Affairs and Climate Action provides innovation vouchers for SMEs in the commerce and skilled crafts sector that use the services of external consulting firms with a view to preparing and conducting innovations in products and technical procedures. For more information, please visit (in German) – the Ministry for Economic Affairs’ official website dedicated to the ‘go-Inno’ funding programme.
  • National contact point for SMEs
    The national contact point for SMEs (NCP SMEs) provides information and advice about the funding programmes offered by the European Commission, particularly about SME-specific funding schemes, and about how companies can claim venture capital under the EU’s ‘Horizon 2020’ research and innovation programme. If you want to keep updated about the latest news, please sign up for the newsletter (in German) published by the national contact point for SMEs or visit the (in German) website.

    Advisory services continue in spite of the coronavirus pandemic.
  • Federal advice on funding for research and innovation
    The Federal Government’s information service provides information on all issues surrounding the research and innovation promotion programmes provided by the Federal Government, the German Länder and the European Commission, on important contact persons and on current funding priorities. In addition to this, the information service provides special assistance for SMEs free of charge.

    Advisory services continue in spite of the coronavirus pandemic.

Agency to promote breakthrough innovations

The mission of the Federal Agency for Disruptive Innovation is to ensure that groundbreaking innovations by companies and research institutions become tomorrow’s cutting-edge German products and jobs. The agency will be open to all subjects, disciplines and technologies, will be agile and flexible and, compared with traditional funding programmes, will be pro-risk and will enjoy a much higher degree of autonomy. It will run innovation competitions and fund cutting-edge projects by subsidiaries which put into practice ideas offering potential for breakthroughs. The agency was founded in Leipzig in 2019. It is still in its early phase and has begun to review the first project submissions.

Fostering networks and clusters

Many companies and research institutions work together in regional or industry-specific clusters and networks in order to create the best possible value chains and improve their competitiveness and innovation capabilities.

  • The ‘go-cluster’programme programme supports Germany’s best-performing cluster management organisations on their path towards becoming professional and internationally recognised centres of excellence. Further priorities include national and international networking, and raising the profile of innovation clusters.
  • Clusterplattform Deutschland – a website run by the Federal Ministry for Economic Affairs together with the Federal Ministry of Education and Research – provides a good overview of the cluster-related policy measures undertaken by the Federal Government, the German Länder, and the EU. The website lists all regional and national cluster initiatives in a way that is clear and concise. It also provides a forum where cluster members and researchers can engage in dialogue.

You can find the model agreements for research and development cooperation here.

Transfer initiative

The sharing of technology and knowledge has a major impact on how marketable innovative products, processes and services are. Despite this, the transfer of knowledge does not go smoothly in many cases – as a result, Germany’s SMEs in particular have a need to innovate. In March 2019, Economic Affairs Minister Peter Altmaier therefore launched the Ministry’s transfer initiative, which is to promote the conversion of ideas into marketable products. To this end, the Economic Affairs Ministry works with innovation stakeholders to see which measures to transform ideas into products already work well, and to identify areas where improvements can be made. The aim is to optimise the innovation ecosystem in Germany and thus to boost the number of innovators and the rate of innovative activity. The transfer initiative, which was included in the coalition agreement, aims to build on and improve the non-sector-specific SME funding programme called ‘From the idea to the market’.