New law to help troubled SMEs find their feet

The Development Ministry intends to use three tools to support the country’s crisis-battered small and medium-sized enterprises (SMEs), in an effort to channel cash into the economy.

Minister Nikos Dendias announced on Monday the drafting of a law to deal with bad corporate loans that will affect 100,000 small companies which employ fewer than 10 people. Their debts to banks will undergo a haircut whose size will depend on the wealth of each enterprise’s owner.

The second tool will entail subsidizing the interest rate for enterprises deemed sustainable and servicing their debts to banks through the use of European Union funds.

The third tool, for the supply of liquidity, will be in the form of a development bank that will operate as a blanket entity covering all existing funding bodies, such as the Hellenic Fund for Entrepreneurship and Development (ETEAN), the Institution for Growth in Greece and the Export Credit Insurance Organization.

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