The Madrid City Council will allocate 1.8 million euros in its 2026 subsidies round to promote products, tools, or services that advance technological modernization and digitalization, targeted at small and medium-sized enterprises (SMEs) and aimed at boosting their competitiveness, as approved by the latest Executive Board meeting.
The objective of these subsidies is to promote the adoption of digital tools, technical specialization, and innovative solutions by the city’s SMEs that strengthen the local supply chain, improve process efficiency, and contribute to increasing their level of autonomy and competitiveness. The funding focuses on digital transformation, advancing the circular economy, energy efficiency, and connected mobility solutions.
Through 2025, the City Council has allocated 6.9 million euros to support the digital transformation of small and medium-sized enterprises, enabling the development of 157 projects led by tech SMEs; all of them are producers of products geared toward other SMEs across different sectors.
Artificial Intelligence and Virtual Reality
Last year’s subsidized projects focused on the development of software, machinery, and hardware to benefit SMEs across sectors and allowed the creation of products aimed at digitizing processes in Industry 4.0, AI-powered robots and virtual reality, a range of business technology solutions for sectors such as healthcare and hospitality, and the development of an AI-based user platform for analyzing cybersecurity risk for SMEs.
Additionally, among the 41 technology modernization and digitalization projects funded in the 2025 call, recipient companies—together employing 666 workers—created 34 new direct jobs through the funded projects.
Recipients of the subsidies and eligible expenses
Subsidy beneficiaries must have their registered office and/or tax domicile in the City of Madrid and conduct their activity within the municipal area where they have acquired or deployed technology solutions aimed at digital transformation, cybersecurity, process automation, circular economy, energy efficiency, and connected mobility.
Eligible expenses are those investments directly linked to implementing technology solutions, including software, hardware, equipment, sensors, automation, applied AI, energy-efficiency solutions, for connected mobility, and the installation, integration, and commissioning services for projects that the company has carried out between January 1 and December 31, 2025. Also eligible are initial technical training, certifications, audits, and deployment services strictly necessary to make the investment operational.
The maximum grant amount is 40,000 euros, with a grant rate ranging from 50% to 80% of the investment, with a mandatory minimum investment required based on the size of the company.
Based on these criteria, a microenterprise (fewer than ten employees) investing a minimum of 10,000 euros will receive up to 80% of that amount, i.e., 8,000 euros. A small business (ten or more but fewer than 50 employees) investing 20,000 euros will receive up to 70% of that amount (14,000 euros). Finally, a medium-sized company (50 to fewer than 250 employees) investing 40,000 euros will receive 50% of that amount (20,000 euros).
This type of aid is compatible with other municipal subsidies, as long as the total investment cost is not exceeded. The application window will be open from September 1 to 15, 2026, inclusive.
