FINANCE

Eight-month support for dues

Gefyra 2 program will subsidize the loan tranches that corporations, freelancers must cover

eight-month-support-for-dues

The state subsidy for corporate loans and freelancers’ debts to banks to be included in the Finance Ministry’s Gefyra 2 program will apply for eight months and range from €600 to €50,000, according to the bill Kathimerini has seen. The amount of support will depend on the size of each company and whether the debts are serviced or not.

The subsidy will start from 90% of the monthly repayment tranche for companies that are consistent with their repayments and drop by up to 70% over the course of the eight-month period, while for enterprises that have delayed their repayments the subsidy will start from 80% and decline by up to 60% of the installment.

The ministry’s objective is for the measure to also incorporate business loans that banks have deemed bad, for which the subsidy will start from 70% and decline to 50% of the tranche.

For companies to join the scheme if they have delayed or bad loans they must first have their dues arranged with the bank and adhere to the arrangement. To reduce the moral risk and avert the emergence of a new generation of bad loans, the corporate dues will not only be monitored closely over the eight months of the subsidy period but also for another 10 months, while for the firms with dues delayed by up to 90 days the monitoring will apply for a total of 12 months.

The incorporation of companies that had bad loans at end-December reflects the ministry’s aim to be inclusive and will be determined by talks with the country’s creditors that will pick up in the coming days. The ministry aims to see the measure benefit as many businesses as possible in an effort to persuade them to have their dues arranged and turn bad loans into performing ones.

The eligibility criteria will be among the main points of negotiation with the creditors and will be set in stone in March, so the subsidy program can begin from May and last to the end of the year. The state subsidy will cover freelancers and companies with an annual turnover of up to €50 million.