Funding for IT and AI projects 2026: What SMEs can still use

Anyone looking for funding for digitization or AI today quickly comes across programs that no longer exist: “Digital Now” has been history since the end of 2023, “go-digital” since the end of 2024, and the subsidy variant of the digitization premium Plus in Baden-Württemberg has also expired. Nevertheless, there is still support in 2026 – only differently distributed and often less known. This article provides an overview of the most important funding paths for IT and AI projects in SMEs, with a focus on the Federal Government and Baden-Württemberg, and shows which program fits which project.

As of October 2026. Funding programs change frequently, budgets are limited. Before each application, check the current conditions at the respective sponsor. This contribution does not replace promotional or tax advice.

What has expired or paused

• Digital now (Federal investment grants): no new applications since the end of 2023.
• go-digital (Consultation promotion of the Federal Government): Expired at the end of 2024.
• Digitalisation Premium Plus, grant variant (Baden-Württemberg): no longer available. The funding will continue as a loan under the name “Digitalisation Financing” via the house bank.
• ZIM – Central Innovation Programme for SMEs: Since 7 July 2026, there has been a temporary suspension of applications because the budget has been exhausted. Projects already approved are ongoing; a resumption is sought for the beginning of 2027, depending on the federal budget.

Grants You Can Use in 2026

BAFA advisory funding – only until 31. December 2026

BAFA’s “Promotion of Management Consulting for SMEs” subsidizes external consulting on economic, financial, human and organizational issues – this can also include digitization and AI topics, such as a potential analysis or the organization of AI implementation and data protection. In the old federal states, including in Baden-Württemberg, the funding rate is up to 50 percent of the eligible consulting costs.

Important: The current directive applies until 31. December 2026. The application must be made:, before the consulting contract is signed – the signature is already the beginning. Up to five consultations per company are eligible during the duration, a maximum of two per year.

Innovation vouchers Baden-Württemberg

With innovation vouchers, the state supports external research and development services for new or significantly improved products, processes and services. According to the latest leaflet of the L-Bank of July 20, 2026, there are:

• Innovation voucher BW: up to 7,500 euros grant at 50 percent funding rate.
• Innovation voucher Hightech BW: up to 20,000 euros at 50 percent, for companies older than five years, for particularly demanding projects.
• Innovation voucher Start-up BW: up to 20,000 euros at 50 percent, for young companies up to five years, including in the area of digitalization.

SMEs with headquarters in Baden-Württemberg, up to 100 employees and a maximum of 20 million euros in turnover or balance sheet total are eligible to apply. Conditions are strict: only genuine R & D services provided by external bodies are supported, explicitly no industry standard programming services, contract development or the purchase of software. Contracts may be concluded only after receipt of the grant decision. For an AI feasibility study with a real research share, the voucher can fit – not for the introduction of a standard solution.

Medium-sized digital centers

The SME Digital Centers funded by the federal government offer SMEs free information events, workshops and practical projects on digitization and AI. The existing network will be phased out gradually by the end of 2026; Starting in 2027, a new network will be launched with a focus on AI, digitalization and IT security. Anyone who wants to use the offers should do so if possible this year.

Tax grant: the research allowance

The research allowance is probably the most underestimated funding instrument for software projects. It is not a competition for limited budgets, but a legal claim – for companies of all sizes. Since 2026, the maximum tax base has been EUR 12 million per year; 25 percent of the eligible costs are supported, for SMEs 35 percent. In addition, there is a lump sum of 20 percent for overhead costs. Also commissioned development – contract research – is included 70 percent of the remuneration.

The prerequisite is that the project is considered research and development. With software this is by no means self-evident, but more often possible than expected.

Promotional loans: KfW and Landesbank

ERP promotional loan digitalization (KfW 511/512)

Since July 2025, the ERP promotional loan digitalization replaces the former ERP digitization and innovation loan. Investments and resources for digitalization projects are supported in three stages – from basic digitalization to challenging projects. Among other things, hardware and software including licenses, implementation with internal and external personnel costs and cloud migrations are eligible. In the higher stages, there is an ERP grant of 3 or more. 5 percent on the loan amount paid out, maximum 200,000 euros. The application runs through the house bank and must be submitted before the start of the project. For the basic level, the free digitization check of KfW is mandatory.

Digitalisation financing Baden-Württemberg

In Baden-Württemberg, there is also the digitization financing of L-Bank as a low-interest loan, also via the house bank. Conditions and current deadlines are best requested directly from your bank.

Training: Funding from the Employment Agency

For the qualification of employees – for example in the use of AI tools or for new IT tasks – the Employment Agency can subsidize course costs and pay. The height depends on the size of the holding; Small businesses receive the most support. A prerequisite is usually an educational institution approved according to AZAV. Especially with regard to the AI competence that the EU AI Act expects from companies, it is worth talking to the employer service.

Which programme fits which project?

• AI potential analysis, digitalization strategy, organizational issues: BAFA advisory funding (until the end of 2026), free offers of the Mittelstand-Digital Centers.
• Feasibility study or prototype with real research share: Innovation voucher BW, research allowance.
• In-house development of software or AI with technical uncertainty: Research allowance – also retroactively for already ongoing projects.
• Introduction of ERP, cloud migration, IT security, software rollout: ERP promotion loan digitalization, digitalization financing BW.
• Training of employees: Promotion of further education by the Employment Agency.

The most common mistakes

1. Starting too early. For almost all grants and loans: Anyone who signs a contract before the application or before the approval loses the grant. The research allowance is the big exception here.
2. Choose the wrong program. A pure implementation project will fail with a research program – and vice versa. Describe your project as it actually is.
3. Overlooked cumulation. The same costs should usually not be supported from several pots, and many grants are de minimis aid with a ceiling of EUR 300,000 over three years.
4. Neglect documentation. Proofs of hours, project descriptions and invoices must be available later – especially for the research allowance.

Conclusion

The time of generous digitalization grants is over for now. Anyone who wants to be supported today must take a closer look: For consulting, there is the BAFA funding until the end of the year, for innovative developments the research allowance and the innovation vouchers, for larger investments the promotional loans. It is crucial to plan and document the project from the beginning in such a way that it fits the appropriate program.

If you plan an IT or AI project and would like to clarify how it can be tailored sensibly, contact us – for example as part of our AI consulting in Stuttgart or free of charge Software project check. The examination of eligibility in individual cases is carried out by sponsors, tax consultants or specialised funding consultants.