The Czech government approved the extension of state-guaranteed loans to companies in the Covid III program with loans intended not only for operation but also for investments. The start of drawing investment loans can be expected around the beginning of May. At a press conference after the government meeting, the Minister of Industry and Trade Karel Havlíček (for YES) announced.
The support will now cover investment loans up to CZK 90 million, depending on the size of the company and the maximum amount of guarantees. In the case of companies with up to 250 employees, the state will guarantee up to 90 percent for loans up to 50 million crowns and up to 50 percent for loans up to 90 million crowns. In the case of companies with 251 to 500 employees, the state should guarantee up to 80 percent for loans up to 50 million crowns and up to 50 percent for loans up to 80 million crowns. It will be possible to apply for support until the end of the year and the duration of the guarantee will be a maximum of six years.
According to today’s statement by the Minister of Finance Alena Schillerová (for YES), the guaranteed loans will gradually replace direct government assistance. “We have the Covid III program, with which we created a credit facility in the amount of approximately 500 billion crowns prepared by commercial banks for entrepreneurs and companies to start their business. I see it as very important to expand the purpose of guaranteed loans from operating to investment,” she said.
Last year’s amendment to the State Guarantees Act, the so-called Covid Invest program, made it possible to extend the purpose of state-guaranteed loans to investments. The EU announced the program on March 29. The Invest modification will extend the existing COVID III program – originally focused only on operating support – as well as on the support of companies that want to implement investment plans within their business activities.
“We are convinced that the demand for investment loans will start to grow with the declining uncertainty caused by the pandemic. Surveys show that guaranteed investment loans could trigger a recovery in the SME segment in particular,” said Tomáš Salomon, president of the Czech Banking Association.
According to the CNB, banks in COVID III approved 4204 applications in the amount of CZK 28.4 billion as of 15 March. Entrepreneurs from the program have so far received loans worth about 23.4 billion crowns. Compared to the data as of 28 February, the number of applications received as of 15 March increased by 280, the volume increased by 1.4 billion crowns.
Source: CTK
