The financial instrument “Capped Portfolio Guarantee for Circular Economy”, with combination of support with grant  within a single operation, is supported under the Programme “Competitiveness and Innovation in Enterprises” 2021–2027.

The instrument aims to facilitate enterprises’ access to investment financing for projects related to energy efficiency and the transition to a circular and resource-efficient economy. The combination of loan financing and grant support enables a more efficient use of public resources by encouraging the participation of private capital and creating improved conditions for the implementation of sustainable investment projects. The support is provided under a clear allocation of responsibilities between the parties and in full compliance with State aid and de minimis rules, as well as with transparency and accountability requirements.

In 2025, the Sustainable Cities Fund was selected by the Fund Manager of Financial Instruments in Bulgaria (FMFIB) as a financial intermediary of the two largest lots, with a total public resource of EUR 80 million, under the financial instrument “Capped Portfolio Guarantee for Circular Economy” (FI CE). On 17 October 2025, the Sustainable Cities Fund for  and FMFIB signed Guarantee Agreements for the implementation of the new financial instrument, which is expected to officially launch in the first quarter of 2026.