European Investment Bank
Organizational profile: The European Investment Bank is the lending arm of the European Union. They are the biggest multilateral financial institution in the world and one of the largest providers of climate finance. The EIB helps the economy, creates jobs, promotes equality and improves lives for EU citizens and for people in developing countries.
The European Investment Bank (EIB) and the European Commission have partnered to create the Natural Capital Financing Facility (NCFF), a financial instrument that supports projects delivering on biodiversity and climate adaptation through tailored loans and investments, backed by an EU guarantee. The NCFF is a dedicated programme to support pioneering conservation and nature-based solutions projects. It consists of:
- a flexible finance facility (typically providing direct/intermediated debt or investing in equity funds); in combination with
- a technical assistance support facility (grants for project preparation, implementation, monitoring and evaluation)
Financing Instrument: Investments in infrastructure and environmental funds through equity, debt, and hybrid debt co-investments. The Natural Capital Financing Facility offers tailored loans and investments backed by EU guarantee.
Project scale: The Natural Capital Financing Facility (NCFF) can provide financing of a minimum amount of €2 million and a maximum amount of €15 million. Larger amounts could be considered, whilst smaller amounts can be accessed through one of the NCFF’s partner institutions. The technical assistance facility can provide each project with a grant of up to a maximum of EUR 1 million for project preparation, implementation and the monitoring of the outcomes.
Typical investment size for investments in equity and debt funds which are focused on projects dealing with climate action and/or infrastructure is between €25 and €60 million, but can go up to €200 million under certain conditions.
Eligibility Criteria: The majority of EIB lending is attributed to projects in EU Member States (about 90% of the total volume) supporting the continued development and integration of the Union. EIB Group activities support the full forest value chain, from production to processing and research, development and innovation. The EIB can finance, either directly or indirectly (through specialised intermediaries), public and private sector entities (including SMEs) as well as timberland infrastructure funds. To be eligible projects must contribute to EU economic policy objectives.
To be eligible for NCFF funding, the organization will need to be legally registered, and be planning projects which are exclusively located within the EU. Projects must also fit within the four categories of
eligible NCFF projects, namely (1) Green infrastructure, (2) Payments for Ecosystem Services, (3) Biodiversity offsets and compensation, and (4) Pro-biodiversity and adaptation businesses. Projects must also demonstrate the ability to generate revenues or cost savings. .
Application guidelines: A project financed by EIB typically goes through seven major stages: proposal, appraisal, approval, signature, disbursement, monitoring, and repayment.
Natural Capital Financing Facility project proposals are examined on a continuous basis, and will be assessed against the following criteria:
• Capacity, experience and resources of the counterparts (final recipient and/or financial intermediary)
• Strength and coherence of the business model • Contribution the EU’s LIFE programme objectives
• Demonstration, replicability, transferability
• Potential leverage effect (how much commercial capital is mobilised by NCFF support)
• Employment creation or safeguard of employment
Full eligibility requirements for NCFF funding can be found through contacting: NCF_Instrument@eib.org