🚀 Start-up grant and entry allowance

Two funding benefits for starting self-employment – depending on whether you come from unemployment benefit I (Arbeitslosengeld I) or from receiving basic income support (Grundsicherungsgeld, until 30 June 2026 Bürgergeld).

Start-up grant (Gründungszuschuss) § 93 SGB III § 94 SGB III Entry allowance (Einstiegsgeld) § 16b SGB II § 16c SGB II Expert body (fachkundige Stelle) Discretionary benefit

In brief

There are two different funding benefits for taking the step into self-employment, depending on which benefit you are coming from. The start-up grant (Gründungszuschuss, §§ 93, 94 SGB III) is for people receiving unemployment benefit I (Arbeitslosengeld I) and is paid by the Agentur für Arbeit (employment agency). The entry allowance (Einstiegsgeld, § 16b SGB II) is for people receiving basic income support (Grundsicherungsgeld, until 30 June 2026 Bürgergeld) and is paid by the Jobcenter. Both are discretionary benefits – there is no legal entitlement, even if you meet all the formal requirements.

Step by step

Arrange an advice appointmentTalk to the Agentur für Arbeit (start-up grant) or the Jobcenter (entry allowance) before you start self-employment. The application must be made before the activity begins; applications made afterwards are excluded.
Prove viabilityFor the start-up grant, prepare a business plan, a capital requirement and financing plan and a profitability forecast.
Obtain an opinion (start-up grant)An expert body (fachkundige Stelle) – such as the IHK, Handwerkskammer, a trade association or a credit institution – confirms the viability of your project (§ 93 para. 2 SGB III).
Submit the phase 1 applicationSubmit the application before starting the activity and wait for approval.
Submit the phase 2 application (start-up grant)After the first six months have passed, submit a separate application for the follow-on funding and prove the actual business activity (§ 94 para. 2 SGB III).
Apply for the entry allowance at the JobcenterPeople receiving basic income support (Grundsicherungsgeld) apply for the entry allowance directly at the Jobcenter; the amount is calculated under the Einstiegsgeldverordnung (entry allowance ordinance) based on the length of unemployment and the household (Bedarfsgemeinschaft).

Deadlines

150 days

Minimum remaining entitlement to unemployment benefit I when starting self-employment, a requirement for the start-up grant§ 93 para. 2 no. 1 SGB III

24 months

Waiting period for renewed funding after a previous start-up grant has ended§ 93 SGB III

6 + 9 months

Duration of the start-up grant: 6 months in phase 1 (last unemployment benefit I + €300/month), a further 9 months in phase 2 (€300/month) on proof of business activity§ 94 paras. 1 and 2 SGB III

at most 24 months

Maximum duration of the entry allowance§ 16b para. 1 sentence 2 SGB II

Watch out – common mistakes

An application after starting the activity is too late – both benefits must be applied for before self-employment begins.
The 150-day remaining entitlement is checked on the day of start-up, not earlier – plan the exact timing carefully.
The application for phase 2 of the start-up grant is often forgotten: there is no automatic extension, a separate application is mandatory.
Both benefits are discretionary – a refusal is possible even if the formal requirements are met.
The start-up grant and the entry allowance are often confused, although they belong to different branches of law (SGB III/employment agency and SGB II/Jobcenter) with different requirements.

In depth · legal basis, figures and practice – for advisers and professionals

Legal nature: discretionary benefits

Both the start-up grant and the entry allowance are expressly “may” benefits without a legal entitlement. The Bundesagentur für Arbeit (Federal Employment Agency) expressly points out on its website that there is no legal entitlement.

Expert body

§ 93 para. 2 no. 2 SGB III names as expert bodies in particular chambers of industry and commerce, chambers of crafts, professional chambers, trade associations and credit institutions. They assess viability based on the business plan and profitability forecast – an opinion needs lead time, so it should be obtained early.

Difference between the branches of law

The start-up grant is an insurance benefit of unemployment insurance requiring a remaining entitlement to unemployment benefit I. The entry allowance is a tax-funded basic income support benefit requiring need (Hilfebedürftigkeit) while receiving basic income support; there is no minimum remaining entitlement period as with unemployment benefit I.

Supplementary instrument: § 16c SGB II

For people who are already self-employed and receive basic income support there are also “benefits for the integration of self-employed people” (§ 16c SGB II) – for example grants or loans for necessary assets as well as coaching. This is not start-up funding but a separate, supplementary benefit. A maximum amount of around €5,000 for benefits in kind mentioned in secondary sources could not be verified against the statutory text itself in the research and must therefore be treated as not conclusively confirmed.

Amount of the entry allowance

The exact amount is not quantified in the statutory text itself but is determined by the Einstiegsgeldverordnung based on the length of unemployment and the size of the household (Bedarfsgemeinschaft) (enabling provision for the ordinance in § 16b para. 3 SGB II). On its website the Bundesagentur für Arbeit gives as a practical figure “at most 50 percent of the relevant standard rate” – this is an administrative statement and not verbatim statutory wording; the exact text of the ordinance was not checked in full text in this research.

Who is responsible

Local Agentur für Arbeit (start-up grant)
Local Jobcenter (entry allowance, § 16c SGB II)

Quick questions

Worum geht es bei „Start-up grant and entry allowance“?

Which deadlines and figures matter?

150 days: Minimum remaining entitlement to unemployment benefit I when starting self-employment, a requirement for the start-up grant (§ 93 para. 2 no. 1 SGB III)
24 months: Waiting period for renewed funding after a previous start-up grant has ended (§ 93 SGB III)
6 + 9 months: Duration of the start-up grant: 6 months in phase 1 (last unemployment benefit I + €300/month), a further 9 months in phase 2 (€300/month) on proof of business activity (§ 94 paras. 1 and 2 SGB III)
at most 24 months: Maximum duration of the entry allowance (§ 16b para. 1 sentence 2 SGB II)

What should I do first?

Arrange an advice appointment: Talk to the Agentur für Arbeit (start-up grant) or the Jobcenter (entry allowance) before you start self-employment. The application must be made before the activity begins; applications made afterwards are excluded.
Prove viability: For the start-up grant, prepare a business plan, a capital requirement and financing plan and a profitability forecast.
Obtain an opinion (start-up grant): An expert body (fachkundige Stelle) – such as the IHK, Handwerkskammer, a trade association or a credit institution – confirms the viability of your project (§ 93 para. 2 SGB III).

What do I need to watch out for?

An application after starting the activity is too late – both benefits must be applied for before self-employment begins.
The 150-day remaining entitlement is checked on the day of start-up, not earlier – plan the exact timing carefully.
The application for phase 2 of the start-up grant is often forgotten: there is no automatic extension, a separate application is mandatory.

Evidence

§ 93 SGB III, gesetze-im-internet.de/sgb_3, retrieved September 2026.
§ 94 SGB III, gesetze-im-internet.de/sgb_3, retrieved September 2026.
§ 16b SGB II, gesetze-im-internet.de/sgb_2, retrieved September 2026.
arbeitsagentur.de, information sheet on the start-up grant and information sheet on the entry allowance, retrieved September 2026.
§ 16c SGB II – maximum amount for benefits in kind supported only by secondary sources, not verified against the statutory text.

As of

As of: September 2026 · Sources and method

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