Glossary

Find an explanation of most used terms in relation to financial instruments

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Title	Term Definition
Final recipient	A legal or natural person receiving financial support from a financial instrument.
Financial instrument	Union measures of financial support provided on a complementary basis from the budget to address one or more specific policy objectives of the Union. Such instruments may take the form of equity or quasi-equity investments, loans or guarantees, or other risk-sharing instruments, and may, where appropriate, be combined with grants.
Financial instrument products	Also called financial products, are types of interventions that may be offered via financial instruments to support projects. The choice of the financial products will depend on the market failures, suboptimal investment situations and investment needs to be addressed as well as the acceptable level of risk, reward and ownership.
Fund of funds	A fund set up with the objective of contributing support from a programme or programmes to several financial instruments. Where financial instruments are implemented through a fund of funds, the body implementing the fund of funds shall be considered to be the only beneficiary.
Funding agreement	Contract governing the terms and conditions for contribution from ESIF programme to financial instrument. This will be established between a managing authority and the body that implements the fund of funds or between a managing authority or the body that implements the fund of funds and the body that implements the financial instrument.