Ex-Post Evaluation of Cohesion Policy Programmes 2007-13, Focusing on the European Regional Development Fund (ERDF) and Cohesion Fund (CF): Work Package 3: Financial Instruments for Enterprise Support - Draft Final Report

For many Member States financial instruments were a new approach to delivering Cohesion policy. Their increased use in 2007 - 13 created significant challenge s especially for MAs with limited experience. The regulatory framework provided flexibility to accommodate domestic arrangements, but demanded considerable administrative capacity. FIs can be more sustainable than grants, generate better quality projects, and may be considered more cost - effective in some circumstances . However, their main rationale in the OPs has been to facilitate access to finance for SMEs, which became more important in the crisis. The scale of FI varies between countries , as does the sh are reaching final recipients. In most countries, FI are over 80% invested, but some very large FIs have been overcapitalised and the EU average is 61%. Governance arrangements tend to be context specific, but build heavily on existing public financial ins titutions. Implementing FI proved complex with demands for greater clarity and certainty met through successive changes to the Regulations and guidance, many of which have been consolidated into the 2014 - 20 regulatory framework. Monitoring systems for FI a re weak, with little hard data on outcomes such as private funding, job creation and innovation, but some evidence that FI increase access to finance and can help develop private markets.