Until the end of 2022, you can receive a grant for starting a business via Diia. Photo: Pixabay
To get a grant for the development of your own small business, you can use the eRobota governmental program via the Diia portal. The government gives Ukrainians microgrants to start their own businesses before the end of 2022.
The procedure and conditions for getting a grant via the Diia portal have been explained by SPEKA.
Applying for a government grant via Diia
To receive money (50,000 to 250,000 UAH) for opening or relocating your business under the eRobota program, you need to be authorized in your citizen’s cabinet on the Diia portal using BankID or digital signature.
Then you need to fill out an online application and attach a business plan (it is advised to make it for several quarters at once). The application should be signed with a digital signature (individual entrepreneurs have to use their entrepreneur’s key).
For an offline consultation, Ukrainians can visit the nearest branch of Oschadbank.
Who can receive a grant via Diia?
Persons eligible to apply for a grant include prospective entrepreneurs, active individual entrepreneurs, or legal entities, provided that they are not located in Russia or territories occupied by Russia and don’t conduct business there.
The person also must not be subject to sanctions or insolvency proceedings, or be brought to justice for corruption in a criminal case by a court’s judgment. Moreover, a person wishing to get a grant has to settle their accounts with the state budget.
When should I apply to open a business?
The fifth round of applications, lasting from September 5 to September 18, 2022, is now ongoing. Applications for grants will be processed by September 30, with the amount allocated for microgrants totalling 480 million UAH.
In addition, the government has scheduled six more rounds before the end of 2022, the next starting on September 19 and ending on October 2. The terms of the remaining rounds are as follows:
- October 03, 2022 — October 16, 2022
- October 17, 2022 — October 30, 2022
- October 31, 2022 — November 13 2022
- November 14, 2022 — November 27, 2022
- November 28, 2022 — December 12, 2022
Who assesses applications for grants submitted via Diia?
The decision on granting money for starting a business is taken by the State Employment Center, but only after Oschadbank evaluates your business plan, checking your business reputation, credit history, and potential profitability.
After that, the applicant will be invited for an interview at their regional employment center, where they will have to defend their business plan.
An application can be denied due to tax debts or problematic late credit payments (over 90 days past due).
Money will be given according to the rating points: those ranking higher will receive their grant earlier, and the amount will depend on the number of jobs to be created (if you create only one job, your maximum possible grant is 150,000 UAH).
What can I spend the Diia grant on?
Grant money under the eRobota program can be spent to buy equipment and raw materials, pay rent (but not more than 25% of the grant), and lease equipment.
The eRobota program has several areas of focus. In particular, those applying for microgrants of up to 250,000 UAH can choose any business area. These grants are often given to open coffee shops, beauty salons, and tailor shops, but other options like an IT startup company can also be proposed.
In addition, you can get a grant for the development of a processing enterprise (here, the maximum possible amount is 8 million UAH), the creation of a greenhouse farm (up to 7 mln UAH for 2 hectares, or about 5 acres), an orchard (pp to 400,000 for 1 hectare), etc.
Will I have to return the money to the government?
Having been granted money, an entrepreneur must create at least one job, perform business activities for at least 3 years, and pay taxes (in particular, for employing workers).
Money must be returned to the government only in the event that the obligations before the government weren’t met, that is, the required number of jobs given the granted amount wasn’t created.
The main advice is to write a well-developed and detailed business plan with cost items broken down. You would want to seek advice from tax computation specialists when writing it.
The most common mistakes made in business plans
- Cost items not properly defined (for instance, the first rounds didn’t allow advertising costs, whereas now you can allocate up to 10% of the granted money for advertising);
- Incorrect tax computation;
- Forgotten utility payments;
- Overly unrealistic and optimistic predictions of business development.