Golden Visa Program Reshapes Bulgaria’s Investment Market
As part of its strategy to strengthen and modernise the country’s capital market, the Bulgarian government has introduced a revamped Bulgaria Golden Visa program. The updated framework includes a fund investment option similar to the Portugal Golden Visa but with two major advantages: for the same investment of €512,000, Bulgaria grants permanent residency instead of temporary status, and the residency card is issued within 8 months, compared to Portugal’s ongoing delays that have left many applicants waiting three to four years. Importantly, there is no physical stay requirments to maintain the permanent residence.
Immediate Market Impact
The launch of the new program has triggered significant activity across the Bulgarian investment sector. Many long-established fund managers—rather than innovating or improving performance—have introduced new investment vehicles specifically tailored for Golden Visa applicants. These new funds often carry very high fees, including subscription fees starting at 2.5%, annual management fees of around 3%, and 5% redemption fees. While these products are aggressively marketed, their fee structures place a heavy burden on investors.
In contrast, a new generation of fund managers has taken a different path. Instead of exploiting investor demand through increased costs, they are launching low-fee, investor-focused funds that challenge the established players. One prominent example is the Bulgaria AIF Fund, created by the Bulgaria Fund Management Company. Positioned as a true market challenger, Bulgaria AIF Fund charges no subscription fees, maintains a low 1% annual management fee, and operates as an open-ended fund, allowing investors to withdraw at any time. For investors familiar with Portugal’s Golden Visa funds—where lock-in periods of up to 10 years are common—this flexibility is a considerable advantage. Bulgaria Fund Management was also awarded Best New Asset Management Company – Bulgaria 2025 by the prestigious Global Banking and Finance Review.
Investment Strategy: Capital Preservation With Strong Upside Potential
Bulgaria AIF Fund is structured to prioritise capital preservation, while remaining open to opportunities that offer low risk with high return potential. The portfolio is primarily composed of fixed-income instruments, including:
- Bonds issued by companies wholly owned by the Bulgarian government, such as Bulgarian Energy Holding, which controls the national nuclear power plant and major energy infrastructure
- Bonds issued by leading Bulgarian banks including First Investment Bank, TBI Bank, and others
This conservative approach provides stability while still enabling strong returns through careful market participation.
Risk Overview
• Currency Risk
There is effectively no currency exposure, as all bonds are denominated in euro. Additionally, Bulgaria is set to adopt the euro on 1 January 2026, further reducing risk.
• Price Volatility Risk
The Fund acquires bonds at IPO at their nominal value (100) and holds them until maturity. Temporary market fluctuations—such as the price falling to 80 or 90—do not affect the final payout, as the Fund still receives the nominal value at maturity.
• Maturity Risk
Most bank bonds in the portfolio mature within three years, with call options typically exercisable after two years. Shorter maturities naturally reduce overall risk.
A recent example is Bulgaria AIF Fund’s participation in the TBI Bank IPO bond, offering a 7% annual coupon from its issuance on 7 January 2025. Under current expectations, the Fund will receive coupon payments for 2026 and 2027, after which the bond is likely to be called.
Are There Alternatives to Fund Investments?
Yes — for investors with a smaller budget, the Bulgaria Golden Visa by Real Estate is a strong alternative. With a minimum investment of €312,000, applicants can obtain Bulgarian residency within four months. Unlike the Fund option, this route provides temporary residency, which must be renewed for five years before becoming eligible for permanent residency.
Compared to Portugal, the Bulgarian real estate route is around €200,000 more affordable while delivering the same residency outcome. A curated selection of vetted, pre-approved Bulgaria Golden Visa real estates is available for investors.
