State bonus for business loans served
The draft law on the State subsidy for the repayment installments of loans to companies provides for a significantly reduced contribution to down payments for loans that banks have denounced, compared to properly paid loans.
The bill relating to the “Gefyra 2” program for subsidizing by the State the tranches of loans owed by businesses and the liberal professions was tabled in Parliament on Monday evening. It provides for optional coverage of most of the amount of each tranche for the next eight months.
According to the bill, the state subsidy will start by covering 90% of the monthly installment for companies paying regularly and will decrease up to 70% during the eight-month period; meanwhile, for companies that have delayed their loan repayments, the subsidy will start at 80% and drop to 60% by the end of the year. The State subsidy for the repayment of bad debts denounced by the banks will however be much lower, going from 50% before being reduced to 30%. A necessary condition is that these loans have been denounced after December 31, 2018, while borrowers must first have their loans reorganized with their creditors within the allotted time.
Gefyra 2 enables the inclusion of active micro, small or medium-sized enterprises – i.e. employing up to 250 people with a turnover of up to 50 million euros or a sum of annual financial accounts up to ‘to 43 million euros based on their latest report. It also allows for the inclusion of independent professionals.
Applicants must prove that they have suffered a decrease in annual turnover of at least 20% and that they have been included in the provisions of one of the measures implemented to mitigate the economic impact of the pandemic.
Eligible companies will also include companies active in the use of real estate assets whose rents have been reduced by government decree, shareholders of personal companies whose operations have been suspended due to Covid restrictions or which have received some other form. support from the state, as well as those who have received a state loan under the “Deposit to be returned” program or have workers whose contracts have been suspended for reasons related to the pandemic. The eligibility criteria also provide for ceilings on the value of real estate assets, deposits and the level of debtors’ indebtedness.