ERP Subsidy Loans 2025: New Financing Options for Digitalization and Innovation in Small and Medium-Sized Businesses
On July 1, 2025, the federal government launched a new funding package to strengthen the digitalization and innovative capacity of small and medium-sized enterprises (SMEs). The “ERP Digitalization Loan” and “ERP Innovation Loan” programs replace previous funding options and now offer SMEs greater flexibility, higher funding amounts, and simplified access to financing solutions.
The Federal Ministry of Finance (BMF), the Federal Ministry for Economic Affairs and Energy (BMWi), and the Kreditanstalt für Wiederaufbau (KfW) are all on board. The goal is to provide targeted support for investments in modern technologies, innovative business models, and future-proof processes.
What do the new ERP funding programs offer?
The two ERP funding loans are aimed at companies with an annual turnover of up to 500 million euros. Freelancers and sole proprietorships can also take advantage of the programs, provided they have a registered office or a permanent establishment in Germany.
The key benefits at a glance:
- No minimum loan amount: Even smaller projects can be financed
- Three funding tiers – tailored to the project’s level of innovation
- Supplementary ERP grant for higher levels of innovation
- Up to 25 million euros in funding per project possible
- Attractive interest rates with an incentive component
The three funding levels in detail
- Basic Funding
The entry-level category is aimed at small businesses with simple digitalization or innovation projects. The maximum loan amount is 7.5 million euros. For digitalization projects, a prerequisite is the completion of the free KfW Digitalization Check, which determines the company’s digital maturity level. - LevelUp Funding
This level is intended for projects with a higher degree of digitalization or innovative products and processes. The maximum funding amount is 25 million euros. In addition, a grant amounting to 3 percent of the disbursed loan amount can be applied for—up to a maximum of 200,000 euros. - High-End Funding
The highest funding level is available for highly innovative or technologically sophisticated projects—such as those in the fields of artificial intelligence or Industry 4.0. Here, too, up to 25 million euros per project is available. The supplementary grant increases to 5 percent of the loan amount, also capped at 200,000 euros.
KfW Digitalization Check as a Prerequisite for Basic Funding
A key element of the digitalization funding is the mandatory KfW Digitalization Check. This helps small and medium-sized enterprises assess the current state of their digital infrastructure. Based on the results, they receive recommendations for the next steps. Only those who complete this check can take advantage of the basic funding under the ERP Digitalization Loan Program.
Application via the company’s bank
As is customary with KfW products, applications for the promotional loans are submitted through the respective primary bank. The supplementary grant can be applied for either at the same time as the loan or within three months of disbursement. A preliminary project review by a financing partner is recommended to ensure eligibility.
Who benefits from the new ERP funding program?
The programs are aimed at a broad target group: from traditional small and medium-sized enterprises to technology-driven startups and innovative craft businesses. Eligible investments include:
- Investments in new machinery or software
- Introduction of digital processes and automation
- Development of new products or services
- In-house research and development
- Technological transformation of existing business processes
Conclusion: New Opportunities for Small and Medium-Sized Enterprises
With the revised ERP funding programs, the government is creating attractive incentives to drive digitalization and innovation in small and medium-sized enterprises. The flexible structure, the elimination of the minimum loan amount, and the supplementary grant make the program particularly appealing to small and medium-sized enterprises.
Anyone planning digitization or innovation projects should review the new programs early on and, if necessary, seek professional advice—to ensure they don’t miss out on funding.
Note for companies in Düsseldorf and North Rhine-Westphalia:
In addition to the nationwide programs, NRW.BANK also offers regional funding opportunities that can be combined with the ERP loans.
