The Government Approves Amendments to the State Program "Affordable Loans 5-7-9%" to Support Small and Medium-sized Businesses under Quarantine

On December 28, 2020, the Government adopted a resolution "On Amendments to the Resolution of the Cabinet of Ministers of Ukraine dated January 24, 2020 No28", in which the Ministry of Finance proposed a number of measures to provide additional support to small and medium-sized businesses under quarantine.

It should be noted, that on November 11, 2020, the Cabinet of Ministers has decided to further intensify anti-epidemic measures, in particular in January 2021.

As a result, micro, small and medium-sized enterprises need more support during the quarantine period by improving the state program "Affordable Loans 5-7-9%".

The amended program provides measures that are a universal and effective mechanism for lending to micro, small and medium-sized businesses.

The adopted government decision provides the following amendments to the state program "Affordable Loans 5-7-9%":

• the program applies to medium-sized businesses with an annual income of up to EUR 20 million;
• loan terms are being liberalized: the term of the loan for financing the working assets has increased to 3 years; the possibility of deferred payment for the loan repayment has been extended to 12 months; the initial payment for an investment project has been reduced (10% for an existing business and 15% for startups);
• the conditions for refinancing loans are mitigated in terms of ensuring the safety of the wage fund, a decrease to 50%, as well as to 50% in the number of employees (as of March 1, 2020);
• for loans aimed at financing working assets, interest compensation is established at up to 0% per annum for the period of quarantine and restrictive measures, and after their cancellation, their compensation continues at the level of 3% per annum. For refinancing loans, interest compensation is established at up to 3% per annum after 31.03.2021;
• settlement of the issue of the possibility of combining government support under the Program "Affordable Loans 5-7-9% " with government support, which can be provided by local state administrations and local governments on the basis of regional and local programs for the development of small and medium-sized businesses.

It should be noted, that as of December 28, 2020, the number of applications for participation in the Program has already reached 58,374 totaling UAH 69 billion.

Since the start of the Program "Affordable Loans 5-7-9%", authorized banks have issued 7,158 loans totaling UAH 16.5 billion.

The Entrepreneurship Development Fund has concluded cooperation agreements with 23 banks.