Co-funding and match funding, explained

"Co-financing" — also called match funding or cofunding — means a grant covers only a stated share of a project's eligible costs, and the recipient (or another public or private co-financer) must supply the rest. The co-financing rate is that share. It is rarely 100%: EU calls state a maximum rate, and national and regional schemes built on EU money inherit a ceiling from it.

For the EU's main regional and social funds, the ceiling is set by Article 112(3) of the Common Provisions Regulation (EU) 2021/1060 and depends on how developed the region is. For the ERDF, the ESF+ and the Just Transition Fund in 2021–2027, the EU share is capped at:

• 85% in less developed regions and outermost regions;
• 60% in transition regions (70% for transition regions that were classed as less developed in 2014–2020);
• 40% in more developed regions (50% for certain more developed regions, such as those that were transition regions in 2014–2020).

These are ceilings for the programme as a whole, not the rate any one call must offer — a programme's own call documents are the only reliable source for its exact rate. Two practical consequences worth planning around: a lower co-financing rate means you need more of your own cash (or a co-financing partner) lined up before you apply, and "your share" usually has to be shown as committed funding in the application itself, not promised later.