Guarantees of the State of Lower Saxony

The state guarantees of Lower Saxony are aimed at commercial enterprises, agricultural, food and forestry businesses, freelancers, and providers of social, cultural, and scientific institutions. Eligible applicants are those with a permanent establishment in Lower Saxony or who carry out eligible measures there. The overarching goal is to enable economically viable and commercially justifiable measures that would otherwise not be realized due to a lack of collateral.

The program supports loans through guarantees for investment, working capital, and guarantee financing. Only certain costs are co-guaranteed, while others, such as overdraft interest or dunning fees, are excluded. The guarantees are primarily intended for financial measures in companies and institutions operating in various sectors and facing financial challenges.

Funding is primarily provided in the form of default guarantees. The state assumes a large part of the default risk for loans granted by financial institutions. The duration of the guarantee is individually adjusted, and certain fees are incurred for processing and administration of the guarantee.

To utilize a state guarantee, applicants and the measures to be financed must meet certain criteria, including creditworthiness, own capital contribution, and the submission of a restructuring concept for restructuring loans. The program is subject to strict EU state aid regulations. Various fees apply, depending on the loan amount, and comprehensive reporting obligations and inspection rights of the state exist.

The application procedure for the Lower Saxony state guarantee is an administrative process handled by PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft (PwC). It involves detailed steps from application submission to assessment and the final decision by the Lower Saxony Ministry of Finance after a resolution by the State Loan Committee. Important deadlines and prerequisites must be observed.

The funding program is based on the General Guarantee Guideline of the State of Lower Saxony. It is subject to EU state aid regulations and the provisions of the Administrative Procedure Act. The guideline sets out the conditions and framework for granting state guarantees.