Sustainable Tourism Loans - Online Applications

Loan applications, together with the accompanying documentation, are received only electronically from 14. 11. 2024

Upon the order of the Ministry of Regional Development and EU Funds of the Republic of Croatia, under and in accordance with the terms and conditions of the Loan Programme, HBOR implements the Sustainable Tourism Loans financial instrument, for which funds are provided from the European Regional Development Funds (ERDF) and HBOR's own sources, and from which financially sustainable investments are financed that contribute to goals of green transition, quality of tourism products and services as well as enhanced growth and competitiveness of micro, small and medium-sized enterprises and that result in diversification of tourism offer, prolongation of tourism season, reduction of excessive tourism, sustainable business and higher quality of tourism offer.

Loans can be disbursed to Borrowers until 31 December 2029, whereas the criteria for the capital discount (write-off of a part of loan principal) can be fulfilled after that date.

1. Borrowers

Private sector entities (companies, crafts businesses and institutions* in private or majority-private ownership) which at the moment of submitting a loan application meet the following criteria:

Micro, small and medium-sized enterprises in accordance with the definition from the Recommendation of the European Commission 2003/361/EC of 6.5.2003;
Registered in accordance with the 2007 National Classification of Activities - 2007 NKD (Narodne novine, Official Gazette of the Republic of Croatia, Nos. 58/07, 72/07) for performing any of the following activities:
- Hotels and similar accommodation (NKD 55.1)
- Camping sites and camping grounds (NKD 55.3)
Not later than at the moment of entering into loan contract, have a registered business unit or branch in the Republic of Croatia

*Health institutions in health tourism in accordance with the Health Care Act (Narodne novine, Official Gazette of the Republic of Croatia, Nos 100/18,125/19,147/20,119/22,156/22, 33/23, 36/24) and the Hospitality Act (Narodne novine, Official Gazette of the Republic of Croatia, Nos. 85/15, 121/16, 99/18, 25/19, 98/19, 32/20, 42/20, 126/21) with all future changes and amendments.

2. Purpose of Loans

Investment in fixed assets (tangible and intangible assets)
Working capital: up to 30% of contracted loan amount

Investments must be aligned with the Do No Significant Harm principle.*

*Criteria and examples of compliance with the Do No Significant Harm principle are available in Schedule 3: Brief instructions to the applicant for the preparation of project and technical documentation for DNSH criteria and infrastructure resilience to climate change.

3. Eligible investments*

Eligible investments in:
- construction, reconstruction and/or renovation of and equipment for hospitality establishments for accommodation and/or
- additional facilities of hospitality establishments for accommodation**

resulting either in the increase in accommodation capacity or introduction of additional optional facilities or classification into type and/or category

Eligible investments are defined in Schedule 1 to the Loan Programme: Investment Eligibility Criteria

*An investment that does not meet the initial investment requirements in terms of state aid criteria is not eligible. An eligible investment in terms of state aid criteria (initial investment) is not current maintenance of existing facilities within the framework of the preparation for the upcoming season or the retention of existing capacities without introducing additional facilities.
**Additional or optional facilities of hospitality establishments for accommodation in the Hotel Group in accordance with the Annexes to the Ordinance on the Classification, Categorisation and Special Standards of Hospitality Establishments in the Hotel Group (Narodne novine, Official Gazette of the Republic of Croatia, Nos. 56/16 and 120/19) with all future changes and amendments.
Additional or optional facilities of hospitality establishments for accommodation in the Camping Sites Group in accordance with the Annexes to the Ordinance on the Classification, Categorisation and Special Standards of Hospitality Establishments in the Camping Sites Group (Narodne novine, Official Gazette of the Republic of Croatia, Nos. 54/16, 68/19 and 120/19) with all future changes and amendments.

4. Manner of Implementation

Direct lending to Borrowers - application and related documentation shall be submitted to HBOR by the Borrower only electronically
Loans are approved from ERDF funds and HBOR funds in a 50:50 ratio with the possibility of writing off a part of the ERDF loan principal (up to a maximum of 50% of the total disbursed loan principal amount), upon the fulfilment of predefined criteria
During the implementation of the Loan Programme, only one loan can be contracted with one Borrower

5. Loan Amount

Minimum loan amount: EUR 250,000
Maximum loan amount: EUR 7,000,000

Generally, HBOR can finance up to 85% of the estimated investment value in accordance with the state aid rules.

If the Borrower is granted regional aid, the Borrower must provide a financial contribution of at least 25% of eligible costs from its own or other sources in a form free of any state aid in accordance with the state aid rules, i.e. up to 75% of the estimated investment value can be financed.

The estimated investment value does not include VAT, except for the Borrowers supplying goods or providing services exempt from VAT and/or for the Borrowers that do not operate in the VAT system.

6. Loan Currency

EUR

7. Capital Discount (write-off of a part of loan principal)

Capital discount, i.e. write-off of a part of loan principal, can be realised for a loan amount higher than EUR 500,000
Capital discount is approved in accordance with the aid rules and it is an aid in the form of a grant
The right to a capital discount is realised upon the fulfilment of the given criteria and it can amount to a maximum of 50% of the total disbursed loan principal amount, provided that the part of the loan principal from the ERDF funds is written off in the amount of the calculated capital discount
The criteria for the capital discount and the percentage of write-off of a part of loan principal that can be realised on the basis of each fulfilled criterion are defined in Schedule 2 to the Loan Programme: Criteria for Capital Discount

8. Interest Rate

On the part of loan principal from the ERDF funds: 0.00% p.a., fixed
On the part of loan principal from HBOR funds: fixed interest rate that is determined separately for each individual loan on the basis of risk assessment

9. Fees

Loan application processing fee: no fee is charged
Commitment fee: no fee is charged

Other fees are charged on the part of loan financed from HBOR’s funds in accordance with the Ordinance on Fees for HBOR Services valid on the day of calculation.
Other fees are not charged on the part of loan financed from the ERDF funds.

10. Period and Manner of Loan Disbursement

Generally, disbursement period is up to 12 months; depending on purpose and dynamics of investment, it is also possible to approve a longer period of loan disbursement
Part of the loan amount intended for the financing of fixed assets is disbursed to the account of the seller / supplier / contractor based on the documentation providing evidence of loan utilisation for earmarked purposes
Part of the loan amount intended for the financing of working capital can be disbursed to the account of the Borrower with obligatory justification by documentation evidencing loan utilisation for earmarked purposes

11. Repayment Period

Depending on the purpose and breakdown of investment, up to 17 years, up to 4-year grace period included

12. Manner of Repayment

Generally, in equal monthly, three-monthly or semi-annual instalments

13. Collateral

In accordance with HBOR’s internal documents (e.g. bills of exchange, debentures, blank debentures, pledge of property with insurance policy for the property endorsed in favour of HBOR, business shares insurance, bank guarantees and other security interests customary in banking operations), and the risk assessment of the investment and the Borrower

14. Schedules

Schedule 1 - Investment Eligibility Criteria
Schedule 2 - Criteria for Capital Discount
Schedule 3 - Brief instructions to the applicant for the preparation of project and technical documentation for DNSH criteria and infrastructure resilience to climate change

15. Related Documentation

General Eligibility Criteria
List of Documentation (Sustainable Tourism Loans)
Decision on General Terms and Conditions of HBOR Lending Activities

This document has been prepared with the support from the European Union. The views expressed in the document do not reflect the official views of the European Union.