New financial products to derisk innovation procurement

Innovation procurement is underutilised in Europe because often public procurers still find it too risky to undertake innovation procurements with their regular procurement budgets and they face difficulties in using existing financial products (such as standard bank loans) for innovation procurements. 

To address this issue, the General Directorate for Research and Innovation of the European Commission has allocated an advisory assignment to the European Investment Bank to explore the potential for creating a new, easy-to-use financial product that financial investors under the InvestEU programme could offer to public procurers across Europe to de-risk innovation procurements, so that they would be more inclined to undertake both R&D procurements to develop and test innovative solutions and public procurements to deploy innovative solutions. 

The assignment will investigate the viability of introducing different financial instruments to mitigate the risks associated with innovation procurement. This could take the form of loans, guarantees, performance bonds or other alternatives (insurance, equity ventures), risk sharing funds etc. The conclusions and recommendations of the assignment will outline the specific characteristics of such an instrument or combination of instruments, whether they are still to be developed or already offered, albeit potentially requiring improvements, by financial institutions such as the EIB or other banks, or alternative financial investors or agents. 

The assignment has a duration of 12 months (March 2024 - March 2025) and starts with a market analysis that will be conducted through a comprehensive approach including surveys, desk research, interviews and focus groups. This multi-faceted approach ensures a thorough understanding of market dynamics and insights from diverse perspectives. The analysis starts with two questionnaires that investigate respectively the barriers that firstly public procurers experience in the financing of innovation procurements and secondly the challenges that suppliers experience in trying to sell innovation solutions to the public sector in Europe. 

All public procurers and suppliers that operate on the European market are kindly invited to take part of this market analysis, by participating to the questionnaire, to the interviews or focus groups that will be organised during the following months. 

• If you are a public buyer, you can contribute by completing the questionnaire for public buyers. 
• If you are a supplier, you can contribute by completing the questionnaire for suppliers. 

You can express your interest to participate in interviews or focus groups by sending an email to IPAdvisoryeib [dot] org (IPAdvisory[at]eib[dot]org). The questionnaires are open until 30 November 2024 and the first workshops are planned between September and December 2024. For questions about the broader EU policy on innovation procurement and the scope of the assignment in this context, you can contact RTD-A5-ASSISTec [dot] europa [dot] eu (RTD-A5-ASSIST[at]ec[dot]europa[dot]eu).

We thank you in advance for contributing to this work. Your insights will help us understand your experience in the innovation procurement market from different angles in this complex landscape. The results of the questionnaires and the final report of the advisory assignment will be posted on this page also once the assignment is completed.

More information

Innovation procurement