We have just received notification that beginning of april 2022 the new budget round will start. we know from the experience of recent years that the budgets are used up relatively quickly, hence our advice: first come, first served.
kmu digital - a model for success
not all digital activities of our government / chamber of commerce are crowned with success: keyword "kaufhaus austria", but the support program kmu-digital is clearly a model for success.
more than 15,000 austrian small and medium-sized enterprises (SMEs) have already benefited from this funding model and thus from the further development of their digital activities.
all the information below still relates to the previous 2021 funding period. there should be no significant changes, but we will update all information and bring it up to date on the day of the new edition.
kmu-digital x.0
Small and medium-sized Austrian companies can currently receive grants of up to EUR 9,000 for consulting and implementing digitalization measures.
What exactly does the program involve? What can be supported? How does the whole thing work?
Who can take advantage of the funding program?
The funding gives small and medium-sized enterprises the opportunity to plan and implement digital projects. Those who are well positioned digitally improve the competitiveness and growth of their own company.
But which companies are eligible and who is excluded from the funding program?
| Eligible companies | Excluded companies |
|---|---|
| natural persons | Agriculture and forestry |
| Legal entities | Aquaculture and fisheries |
| Microenterprises | Companies with a digital core business such as brokerage platforms |
| SMEs with registered office or permanent establishment in Austria | Non-profit associations |
| Partnerships | Regional authorities |
Eligible natural and legal persons and partnerships must operate a business independently in their own name and for their own account. Funding is also possible if they practise a liberal profession (chambered or non-chambered) independently and have a key figure from the business register.
However, there are also some reasons for exclusion. Insolvency proceedings must not currently be ongoing against the grant applicant. Or at least one year must have passed since insolvency proceedings were terminated following the restructuring and payment plan.
Which costs are eligible?
The program is divided into two eligible modules. There are the consulting and implementation modules. SMEs receive grants for both areas. However, there are some non-eligible costs that must be taken into account.
Consulting module
Companies that have so far paid little attention to the topic of digitalization are an important target group for the funding. The consulting module provides companies with an overview of the benefits of digitalization and motivates them to take the next step.
Advice on various topics and focal points provided by certified experts is subsidized. These include
Status and potential analysis and strategy consulting in the following areas:
- Business models & processes
- E-Commerce & Online Marketing
- IT and cybersecurity
The status and potential analysis toolbox was developed to record the current status and identify structured methods and the need for action.
During a meeting, certified consultants explain digital trends, potential opportunities and point out possible risks.
In addition to the eligible modules, there are also a number of cost items that are not eligible for funding. There is no funding for costs such as
- Expenses of the consultant
- Costs incurred before the application was submitted
- Consulting costs that are not directly related to the digitization project
- Consulting costs that have already been supported by other funding projects and a funding rate of over 100 percent is achieved
- Value added tax on consulting costs
- Consulting costs for business location outside Austria
However, there are also exceptions with regard to VAT. If the grant recipient is demonstrably not entitled to deduct input tax, the tax amount must also be added to the eligible costs.
Implementation module
The second eligible area is the implementation module for the measures defined in the strategy consultation. The completed consultation is a mandatory requirement for the implementation module.
Both tangible and intangible investments that are directly related to the digitization project are eligible for funding. This also includes programming activities and software licenses (for a maximum of 12 months).
Overall digitization packages are also eligible for funding. Such a project also includes setting up a homepage, accompanying legal advice, setting up a web store and running costs for a maximum of 12 months.
The SME DIGITAL implementation toolbox is made up of four sections. Companies can choose from the following sections:
- Business models & processes
- E-Commerce & Online Marketing
- IT and cybersecurity
- Digital administration
Implementation in the area of business models & processes includes services such as the development and improvement of products, services and business models through digital applications such as CRM systems.
In the second area (e-commerce), the digital implementation of the sales and distribution process is promoted. B2B or B2C applications and the implementation of innovative online strategies are possible.
The third area comprises the improvement or initial introduction of IT security measures. The establishment of security management with the area of data protection is also eligible for funding.
If digital administration such as digital signatures and the use of e-invoices becomes necessary, the costs for such measures are subsidized via the funding program.
However, there are also some ineligible costs in the area of implementation. The following are excluded from KMU DIGITAL funding:
- Implementation projects that exceed a total eligible amount of EUR 30,000 or do not reach EUR 3,000 (all net amounts)
- Costs incurred before the application was submitted
- Costs that are not directly related to the project to implement the digitization measures
- Replacement investments without further developments such as PC replacements, website updates or standard upgrades
- Investments outside Austria
- Projects for which funding is not entirely certain
- Other financing costs, vehicles, financial assets and ongoing operating costs
- Costs from company acquisition or takeover
- Costs for export-related activities
- Costs that are already subsidized and therefore exceed a funding quota of 100%
- Costs that were already eligible and settled in the consulting module
- Small-value invoices under 150 euros (excluding ongoing costs from external providers for a maximum of 12 months)
- VAT is not eligible if the company is entitled to deduct input tax
As can be seen from the many exclusions, only those costs that are actually related to the implementation of the digital project are funded.
How much funding is available?
The funding for the two modules varies. A maximum funding amount of € 3,000 is provided for the consulting module. Funding of up to €6,000 is possible for the implementation module.
Grants in the consulting module
Grant applicants can choose from the various tools as they wish. However, the amount of the grants depends on the tool selected. Please note the following grants in the consulting module:
- per tool of the status and potential analysis: 80% of the consulting costs, but max. 400 €
- for strategy consulting: 50% of the consulting costs, but max. 1,000 €
SMEs can combine the individual tools in the toolboxes from the consulting module as they wish. The total funding will not exceed €3,000 during the funding period for the first module.
Grants in the implementation module
A maximum of 30% of the eligible costs will be subsidized in the implementation module. The grant amount of €6,000 will not be exceeded during the funding period, regardless of how many tools are selected.
However, it should be noted that the eligible costs must be at least €3,000. A project may cost a maximum of €30,000 in order to receive a grant. As always, all figures are exclusive of VAT.
Before a grant is approved for implementation, it is checked whether the subsidized advice has been used and settled in advance.
What are the deadlines for consultation and implementation?
The SME DIGITAL 3.0 funding program is currently open-ended. the time limit is due to the unfortunately limited budget available.
The first step is to submit an application for the consulting module. If sufficient funding is available and the costs are eligible according to the funding guidelines, funding will be approved.
An appointment for the consultation must be made within seven days of the funding approval. Once the appointment has been made, the period begins and the funds are reserved. The consultancy project must be completed and invoiced within three months.
With regard to implementation funding, a period of three months must be observed. Otherwise the funding offer is deemed to have been revoked. Funding applications for the implementation module can also be submitted online.
There is a deadline of one year from the date of application for the implementation of the digital project itself. The work must be completed and invoiced within this year.
When is the grant paid out?
The grants for the digital project are always paid out after the project has been completed. For this, companies must submit various documents such as invoices from the consultant, proof of payment and other items such as consultancy reports electronically via the submission platform.
Invoices and receipts must be submitted within three months of project completion. In justified exceptional cases, the aws may extend the deadline by one month.
An SME must pay the consultant's invoice in full in advance. After the documents have been checked, the SME receives the grant afterwards. Payment is normally made as a one-off amount.
Who checks the grant application and what is taken into account?
The aws is responsible for reviewing grant applications. As funds are limited, grant applications are approved in the chronological order in which they are received.
If the funds are used up, no reservation confirmations for the funds are sent. Instead, companies are informed that they have not been approved. The earlier companies take action, the better their chances of receiving the grant.
The task is to check whether the guidelines are being adhered to. Has no consultation of this kind taken place beforehand? Has the maximum funding amount already been achieved? Does the selected consultant have the necessary certification?
There is a special page on which the certified consultants are listed. Certified consultants are listed on the Page with all important contact details listed. We are also certified and are a good point of contact for consulting and implementing your digitization project.
How and where do I apply for a grant?
The Funding applications are available online at kmudigital.at. The online form contains the modules Advice and Implementation. All you have to do is complete and submit the relevant application.
After the funding application has been checked, there is an online notification as to whether the funds have been reserved.
Conclusion: It pays to be quick - send off your grant application quickly
The funding from the KMU DIGTIAL funding program is impressive. SMEs should not do without it. As the funding program and the funds are limited in time, it is important to act quickly.
We at Digital Now are certified consultants for eCommerce and social media.
