Access to finance - Bulgaria

Updated 09/2011

The simplest way of getting financing in Bulgaria is through a loan. You can get a loan regardless of your company's status, and you can also get one if you are a freelance professional, provided that what you do meets the definition of commercial activity in accordance with the Commercial Code (TZ).

Bulgarian Commercial Code (TZ)

Credits are subject to certain rules set out in the law.

The Credit Institutions Act (ZKI) [254 KB]

There are also rules for raising funds on the capital market.

The Public Offer of Securities Act (ZPPTsK)
The Financial Instruments Markets Act (ZPFI)
The Law Against Abuse of the Financial Markets (ZPZFI) [295 KB]
Financial Supervision Commission

Public finances

Indirect support

A credit line was established for energy efficiency and renewable energy resource projects. This programme gives credit lines to participating Bulgarian banks, which for their part issue loans to private companies for industrial energy efficiency and renewable energy projects.

Credit line

Credit lines are also available from the European Investment Bank (EIB) and the International Fund for Assistance in the Decommissioning of the Kozloduy Nuclear Power Station. The credit line combines EIB loans with subsidies from the International Fund.

Direct support

The Bulgarian government has developed a number of schemes and programmes to help fund businesses. A case in point is the Energy Efficiency Fund, which acts as a financial institution in that it issues and underwrites credits, while acting as a centre for consultations at the same time. The fund concentrates on energy-saving projects.

Energy Efficiency Fund

The Bulgarian government has set up the National Innovation Fund. It funds scientific research projects with up to BGN 500 000 and technical feasibility studies with up to BGN 50 000.

National Innovation Fund

Access to EU funding

There are local contact persons who work together to prepare funding applications under the Intelligent Energy - Europe Programme. This includes consultations on technical and administrative matters concerning offers to put forward projects, finding project partners and participating in tenders for national co-financing funds, where applicable.

Intelligent Energy - Europe

Bulgaria provides national coordinators from the National Contact Network to manage the Seventh Framework Programme. They are distributed over 20 industrial sectors, depending on their specialist field. Financing programmes and the period they cover are posted on the network's website, and focus on applied science.

Contact Network

The operational programme 'Development of the Competitiveness of the Bulgarian Economy 2007-2013' is an operational programme co-financed by the EU Structural Funds since Bulgaria's accession to the EC.

OP 'Developing Competitiveness'

Private financing

Banks

The administrative procedures for applying for credit from the commercial banks are laid down by the banks themselves and described in detail on their websites. The government imposes strict requirements on the banking system to ensure its stability.

In addition to traditional loans, many Bulgarian banks now provide funding to enterprises through factoring, a service which includes:

funding based on invoices issued by suppliers of goods and services, i.e. on the payments due to the supplier from clients;
administration of the invoices under which payments are due to the supplier;
encouraging increased turnover between supplier and customer.

You can find a complete list of banks licensed in Bulgaria on the website of the Bulgarian National Bank.

Bulgarian National Bank

Stock Exchange

One of the most widespread methods of financing a company's business activity is registration on the stock exchange. The securities market in Bulgaria has risen dramatically in the past few years, with large numbers of companies now trading on it.

The Bulgarian Stock Exchange

Registering a company on the Bulgarian Stock Exchange to raise capital is subject to numerous rules. These aim to protect the stability of the capital market. To register on the stock exchange, your company needs to be public. You still need to issue a public offer prospectus, which has to be approved by the Financial Supervisory Commission (FSC). Details of the steps required can be found on the FSC's website.

Investment brokers

Another way of seeking funding is from financial institutions other than banks. These include licensed investment brokers who allow private individuals and corporations to invest in capital market funds.

Another possible source of funding are debenture loans with a fixed repayment term. You can get information about these from investment brokers.

Investment brokers

In recent years, many people and companies have turned to financial brokers for credit. This simplifies procedures and saves time. Usually it means that the cost of the loan will not increase. Many brokers are happy to give a free consultation if necessary.

There are also a variety of non-government funds in Bulgaria. They offer funding to businesses operating in various sectors. SEAF is a global risk capital fund management organisation with a head office in Washington D.C.

SEAF Bulgaria

The Bulgarian-American Enterprise Fund can help SMEs and promotes joint ventures between Bulgarian and Western European companies The Bulgarian-American Enterprise Fund (BAEF) is a private corporation established in the USA.

Bulgarian-American Enterprise Fund

You can find information on the support available to companies who want to invest in Bulgaria on the website of the European Bank for Reconstruction and Development, which has a particular focus on promoting foreign investment in the Bulgarian economy. The EBRD's website gives detailed information on all the procedures and kinds of finance available, some of them including supplementary funding agreed with commercial banks.