The state-owned promotional bank KfW offers a range of financing options for your broadband project with its various Digital Infrastructure loan programs. In cooperation with the respective financing partners – usually banks or savings banks – KfW promotes investments in the expansion of gigabit-capable networks in Germany via the “Digital Infrastructure” investment or syndicated loan.
1 Investment loans for digital infrastructure
Digital infrastructure investment loans (loan programs no. 206 and no. 239) can be used to provide projects with secure and low-interest financing in cooperation with financing partners. The BMVI funds are used to provide reduced interest rates with the option of agreeing long-term fixed-interest periods (up to 20 years) and loan terms. Who is supported?
- Domestic and foreign companies, the majority of which are privately owned
- Companies with a municipal shareholder background of at least 50% (direct or indirect participation of one or more local authorities or federal states totaling at least 50% with a minimum municipal participation of 25%)
What is supported? The entire investment costs for the expansion of public FTTH/ FTTB networks, including ancillary costs, are subsidized at a subsidy-free interest rate above the EU reference interest rate. The following requirements apply:
- Construction of a passive FTTH/FTTB network incl. connection of mobile phone masts
- Active components of an FTTH/FTTB network including “in-house cabling”
Excluded from funding are
- Debt rescheduling of already completed and fully financed projects
- Lease financing
- In-Sich transactions, i.e. the seller and purchaser of the capital goods to be financed are identical shareholders
| Variant A: Standardized loan (No. 206) | Variant B: Individual loan (No. 239) | |
| Interest rates | State aid-free interest rate above the EU reference rate | State aid-free interest rate above the EU reference rate |
| Terms | at least 4 years | Individual agreement with regard to the individual project |
| Loan amount | Funding of up to €50 million per project, financing of up to 100% of eligible costs | For loan amounts from € 25 million, individual agreement with regard to the individual project |
| Repayment | 1-5 redemption-free years depending on the term, then quarterly installments of the same amount | Individual agreement with regard to the individual project |
| Collateral | Collateral is agreed in consultation with your financing partner | Collateral is agreed in consultation with your financing partner |
Further information can be found on the KfW website.
2 Syndicated loan for digital infrastructure
Projects with complex and individual financing requirements are supported with the “KfW Consortium Loan Digital Infrastructure” (loan program no. 854). Through this program, KfW participates like other (banking) partners in the financing of projects within the framework of banking consortia. KfW provides direct loan funds and assumes credit risks, in each case in installments on the same terms as the other financing partners. Who is supported?
- Domestic and foreign commercial enterprises that are majority privately owned
- Companies with at least 50 percent municipal shareholder background
- Project companies (regardless of shareholder background)
What is supported? Funding is available for expenditure on investments and operating resources, including ancillary costs, in connection with the expansion of fiber optic networks in Germany. The following projects in particular will be funded:
- Expansion of passive FTTH/ FTTB infrastructure
- Installation of active components of the FTTH/ FTTB network,
- Expansion of the back bone
- Networking with other infrastructures (e.g. connection of mobile phone masts, data centers)
Excluded from funding are
- Debt rescheduling of already completed and fully financed projects
Conditions As part of KfW’s participation, which is structured in the same way as the participation of the other financing partners in the debt financing, the KfW risk share is generally up to a maximum of € 30 million. If KfW considers the following aspects to be in line with market conditions as part of a creditworthiness and risk assessment, it assumes the conditions agreed by the financing partners, such as the term, repayment mode, margins, commitment fee, fees and collateralization structure. All financing partners participating in the consortium also have the option of being refinanced bilaterally by KfW. Further information is available here.