Financing a circular project
  • Circular funding programme
  • Circular project assessment
  • Circular project monitoring
  • Equity
  • JICE
  • Loans
  • Promotional banks and institutions

National promotional banks and institutions (NPBIs) play an important role in achieving policy ambitions. These public banks operate mainly at country or regional level. In order to support national or regional governmental targets, NPBIs invest in thematic projects, funds and companies. With the growing policy attention for circular economy, some NPBIs have started to implement circular funding programmes and instruments.

The recently launched Joint Initiative on Circular Economy external link icon (JICE) is a partnership between the European Union’s largest NPBIs and the European Investment Bank to increase investments in the circular economy. The partners of the initiative are Bank Gospodarstwa Krajowego from Poland, Caisse des Dépôts from France, Cassa Depositi et Prestiti from Italy, Instituto de Credito Official from Spain, and Kreditanstalt für Wiederaufbau (KfW) from Germany, who work together with the EIB. The banks already have some years of experience with circular investments.


The Joint Initiative on Circular Economy (JICE) will boost investments in the circular economy. Five NPBIs and the EIB have a target to provide at least EUR 10 billion of investments in this sector over the next five years (2019 – 2023). The partnership brings more than financing, bringing together the expertise and experience from six institutions active in the circular field. This partnership may also involve development of new financing and advisory tools and measures to build awareness and share knowledge with businesses and other stakeholders.

The initiative recognises the need for a diverse set of funding instruments. Partner organisations will provide loans, equity investment or guarantees to eligible projects. The JICE partners offer innovative financing structures for public and private infrastructure, municipalities, and private enterprises of different size as well as for research and innovation projects.1

Kreditanstalt für Wiederaufbau (KfW) and Caisse des Dépôts are two of the JICE partner organisations. Although these NPBIs are already active in circular economy funding, they emphasise the importance of the initiative. It allows for knowledge sharing on good practices and it provides a way to define a shared vision on circular economy. In a second step, JICE can provide the basis for a joint sectoral approach or instrument to tackle certain elements of the circular economy.

KfW and Caisse des Dépôts

Sustainability has been on the agenda for a long time for both KfW and Caisse des Dépôts. For example, KfW’s Smart Cities external link icon project supplies grants for cities and municipalities related to digitalisation, while also taking into account topics such as energy-efficiency, the environment, and mobility.

To a certain extent, circular economy can be seen as a deepening of their sustainability approach. The banks align their focus on circular economy with existing ambitions on sustainable development goals (SDGs) or on corporate social responsibility (CSR). Important is also the contribution that circular economy investments can make on national climate targets. At the same time, interviews with experts from the banks show that there can also be differences with sustainable finance. Some valuable lessons:

  • Providing examples and good practices is important to convince more actors to get involved in circular projects. By investing in a circular project, you can encourage other investors that such projects are bankable and that great impact can be achieved.
  • Involvement of technical experts in the monitoring of investments can play a key role in determining the actual impact of an investment.
  • To assess the risk of circular projects, it is wise to develop a different methodology than for linear projects that is tailored to circular business models.
  • The ecosystem perspective of some circular economy projects can be a bottleneck from an investor’s perspective. A city authority can play an important role in financing such projects by for example, establishing a revolving loan fund, or issuing social impact bonds or other financial instruments. It is however important to adapt the risk assessment methodology to make it more suitable for circular projects.

Waste recovery and recycling centre on le de Îla Réunion
Figure 1. Circular economy project financed by Banque des territoires in 2018: the construction of a waste recovery and recycling centre on le de Îla Reunion (Pierrefonds). Financed with a EUR 19.5 million loan granted by Ileva society.

More information

KfW: Smart City Charter external link icon

JICE: EIB website external link icon



Caisse des Dépôts: Jacques Rosemont