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Call key data
Transaction Costs Support for social finance intermediaries
Funding Program
European Social Fund+
Call number
ESF-2026-AG-TCS
deadlines
Opening
18.06.2026
Deadline
23.09.2026 17:00
Funding rate
80%
Call budget
€ 4,700,000.00
Estimated EU contribution per project
between € 400,000.00 and € 750,000.00
Link to the call
Link to the submission
Call content
short description
The general objective of the call is to further develop the social enterprise finance market by supporting the social finance intermediaries to provide the needed capital to social enterprises and mission-driven enterprises.
Call objectives
The call builds upon previous similar calls and aims above all to support social finance intermediaries who undertake long-term risk capital investments in social enterprises and mission-driven enterprises. Therefore, the key objective of the present call of proposals is to catalyse risk capital investments below EUR 1 000 000 that otherwise would not happen in the area of social enterprise finance. The call aims to support the transaction costs for these low value investment tickets and thus to help to overcome the identified market failure / mismatch in the social investment market.
The present call also encourages the European (trans-national) and innovative dimension of social finance schemes and support towards emerging social finance markets, e.g. via cross-border investments and cooperation, dissemination of good practices, etc.
Under this call for proposals, the transaction costs support scheme will take the form of a grant, and it can be combined with financial instruments as means to address the mismatch of needed and sustainable ticket sizes.
By transaction costs, this call for proposals understands the different costs linked to these investments, such as due diligence related costs, legal advice fees, travel costs, business development support costs, support towards establishing an impact measurement and management plan or system, etc.
The action grants are aimed at financial intermediaries that undertake long-term risk capital investments in ticket sizes of less than EUR 1 000 000 in social enterprises and mission-driven enterprises in EU Member States and ESF+ Associated Countries.
The long-term capital investment can take the form of:
- equity, understood as the provision of capital to a firm, invested directly or indirectly in return for total or partial ownership of that firm and where the equity investor may assume some management control of the firm and may share the firm’s profits.
- quasi-equity, understood as a type of financing that ranks between equity and debt, having a higher risk than senior debt and a lower risk than common equity. Quasi-equity investments can be structured as debt, typically unsecured and subordinated and in some cases convertible into equity, or as preferred equity.
- or hybrid financing, understood as any flexible form of repayable finance combining the characteristics/features of at least two of the three financing instruments: grant, debt, and equity.
The action grants should serve to cover part of the transaction costs for these small investment tickets and thus help overcome a market failure in the social enterprise finance market.
The long-term risk capital investment can reach per investee at maximum EUR 1 000 000 over a period of 18 months.
This means that if a second investment in the same social enterprise or mission-driven enterprise takes place within less than 18 months from the first investment and this raises the cumulative amount invested above the limit of EUR 1 000 000, the costs of the activities related to the first investment become ineligible for grant support, and any related payments already made by the Commission will be subject to recovery.
In relation to the investees, i.e. the social enterprises or mission-driven enterprises that the grant beneficiaries will invest on, the following conditions apply:
The selected investees must be:
- social enterprises, as defined in the Article 2(1.13) of ESF+ Regulation, which means an undertaking, regardless of its legal form, including social economy enterprises, or a natural person which:
- in accordance with its articles of association, statutes or with any other legal document that may result in liability under the rules of the Member State where a social enterprise is located, has the achievement of measurable, positive social impacts, which may include environmental impacts, as its primary social objective rather than the generation of profit for other purposes, and which provides services or goods that generate a social return or employs methods of production of goods or services that embody social objectives.
- uses its profits first and foremost to achieve its primary social objective, and has predefined procedures and rules that ensure that the distribution of profits does not undermine the primary social objective.
- is managed in an entrepreneurial, participatory, accountable and transparent manner, in particular by involving workers, customers and stakeholders on whom its business activities have an impact.
- or mission-driven enterprises, which defining feature is structural integration of positive contribution into value creation, not merely compliance, operational efficiency, or net-zero internal performance; therefore, regardless their legal forms, mission-driven enterprises are characterised by the following features:
- they are commercially operating legal entities that intentionally pursue one or more specific social and/or environmental objectives alongside economic performance and structurally integrate those objectives into their business model and governance.
- their business models are designed so that scaling commercial activity is expected to scale intended positive impacts.
- they are fundamentally structured to deliver significant positive impacts through core activities while identifying, preventing, and mitigating adverse impacts in line with EU Corporate Social Responsibility (CSR) and Responsible Business Conduct (RBC) principles.
- they embed stakeholder-informed governance and maintain credible, proportionate processes to measure, manage, and report their contribution to those objectives.
As an indication, the overall support request for the transaction costs should not exceed 10% of the total expected investment portfolio in social enterprises and mission-driven enterprises. For applicants with average investment tickets of less than EUR 300 000, the support request should not exceed 15% of the total expected investment portfolio.
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Expected effects and impacts
Actions funded under this Call are expected to contribute to increase the number of risk-capital investments of below EUR 1 000 000 in social enterprises and mission driven enterprises.
In the longer term, the Call is expected to contribute to overcome the market failure in the social investment market and to address the mismatch between needed and sustainable ticket sizes.
In line with point 2.5 of the application template “Project management, quality assurance and monitoring and evaluation strategy”, the application shall include a description of evaluation methods and indicators (quantitative and/or qualitative) to monitor and verify the achievement of the main expected results. These indicators should be realistic, measurable and relevant. Their level of achievement or deviations thereof must be detailed and justified in the final reporting.
Expected results
This call will support proposals whose activities contribute to the implementation of the above-mentioned objectives and priorities.
The types of activities which can be funded under this call for proposals include, but are not limited to:
- The activities related to the preparation, conclusion and follow-up of long-term risk capital investments into social enterprises and mission-driven enterprises which are considered eligible to be funded under this call for proposals. These activities can include a mix of activities such as:
- travelling to meet (potential) investees
- screening and processing investment applications
- preparing legal documents, potentially with the help of legal adviser
- carrying out due diligence, including assessing (potential) impact of the investment
- providing investment readiness, scaling readiness or business restructuring support
- providing support to investees with the development of their impact measurement and management plan or system
- bringing in co-investors
- managing the investments and social impact.
- Activities related to the overall EU value-added and the innovative dimension of the financing schemes which can include activities such as:
- developing or testing an innovative solution or tool which could help to lower the transaction costs in a more structural and sustainable way
- cross-border experience sharing and support to peers in emerging social enterprise finance markets
- activities encouraging investments across the border in emerging social enterprise finance markets
- dissemination of good practices activities and/or support to other potential funders and/or national and regional authorities to set up equivalent schemes.
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Eligibility Criteria
Regions / countries for funding
Moldova (Moldova), Bosnia and Herzegovina (Bosna i Hercegovina / Босна и Херцеговина), Iceland (Ísland), Kosovo (Kosova/Kosovë / Косово), Liechtenstein, Montenegro (Црна Гора), Serbia (Srbija/Сpбија), Ukraine (Україна)
eligible entities
Other, Private institution, incl. private company (private for profit)
Mandatory partnership
No
Project Partnership
In order to be eligible, the applicants (beneficiaries and affiliated entities) must:
- be legal entities (public or private bodies)
- be established in one of the eligible countries, i.e.:
- EU Member States (including overseas countries and territories (OCTs))
- non-EU countries: listed EEA countries and countries associated to the ESF+ (list of participating countries), or
- countries which are in ongoing negotiations for an association agreement and where the agreement enters into force before grant signature.
The single applicant or the lead applicant in case of a consortium must be:
- either the established legal entity of an investment fund, or a Fund-of-Funds, or a special purpose vehicle, in any form, or a (co-)investment scheme of any form.
- or the organisation managing a ready to be established investment fund, Fund-of-Funds, the special purpose vehicle, or the (co-) investment scheme, of any form. In this case and for the avoidance of doubt, the managing organisation must be already established and registered as legal entity at the time of the submission of the application.
other eligibility criteria
Specific cases
Exceptional funding — Entities from other countries (not listed above) are exceptionally eligible, if the granting authority considers their participation essential for the implementation of the action.
Natural persons — Natural persons are NOT eligible (with the exception of self-employed persons, i.e. sole traders, where the company does not have legal personality separate from that of the natural person).
International organisations — International organisations are NOT eligible.
Entities without legal personality — Entities which do not have legal personality under their national law may exceptionally participate, provided that their representatives have the capacity to undertake legal obligations on their behalf, and offer guarantees for the protection of the EU financial interests equivalent to that offered by legal persons.
EU bodies — EU bodies (with the exception of the European Commission Joint Research Centre) can NOT be part of the consortium.
Associations and interest groupings — Entities composed of members may participate as ‘sole beneficiaries’ or ‘beneficiaries without legal personality’.
Social partner organisations — These include notably the European social partner organisations that are consulted in accordance with Article 154 TFEU (for the list, see List of consulted organisations) as well as other European-level social partner organisations that are not included in this list, but who are for example involved in the preparation and launch of European social dialogue at sector level. Social partner organisations without legal personality are eligible provided that the conditions for entities without legal personality (see above) are met.
Countries currently negotiating association agreements — Beneficiaries from countries with ongoing negotiations for participation in the programme (see list of participating countries above) may participate in the call and can sign grants if the negotiations are concluded before grant signature and if the association covers the call (i.e. is retroactive and covers both the part of the programme and the year when the call was launched).
EU restrictive measures — Special rules apply for entities subject to EU restrictive measures under Article 29 of the Treaty on the European Union (TEU) and Article 215 of the Treaty on the Functioning of the EU (TFEU). Such entities are not eligible to participate in any capacity, including as beneficiaries, affiliated entities, associated partners, subcontractors or recipients of financial support to third parties (if any).
EU conditionality measures — Special rules apply for entities subject to measures adopted on the basis of EU Regulation 2020/2092. Such entities are not eligible to participate in any funded role (beneficiaries, affiliated entities, subcontractors, recipients of financial support to third parties, etc). Currently no such measures are in place.
Additional information
Topics
Relevance for EU Macro-Region
EUSAIR - EU Strategy for the Adriatic and Ionian Region, EUSALP - EU Strategy for the Alpine Space, EUSBSR - EU Strategy for the Baltic Sea Region, EUSDR - EU Strategy for the Danube Region
UN Sustainable Development Goals (UN-SDGs)
project duration
between 36 and 48 months
Additional Information
Proposals must be submitted electronically via the Funding & Tenders Portal Electronic Submission System (accessible via the Topic page in the Calls for proposals section). Paper submissions are NOT possible.
Proposals (including annexes and supporting documents) must be submitted using the forms provided inside the Submission System (NOT the documents available on the Topic page — they are only for information).
Proposals must be complete and contain all the requested information and all required annexes and supporting documents:
- Application Form Part A — contains administrative information about the participants (future coordinator, beneficiaries and affiliated entities) and the summarised budget for the project (to be filled in directly online)
- Application Form Part B — contains the technical description of the project (template to be downloaded from the Portal Submission System, completed, assembled and re-uploaded)
- mandatory annexes and supporting documents (templates to be downloaded from the Portal Submission System, completed, assembled and re-uploaded):
- CVs (standard) of core project team
- activity reports of last year
- list of previous projects (key projects for the last 3 years) (template available in Part B).
Proposals are limited to maximum 40 pages (Part B). Shorter proposals are welcome.
Financial support to third parties is not allowed.
Call documents
Call Document ESF-2026-AG-TCSCall Document ESF-2026-AG-TCS(529kB)
