Bulgaria’s government has approved a 200 million levs ($111.9 million/102.3 million euro) interest-free loan programme of state-owned Bulgarian Development Bank (BDB), aimed at supporting people unable to work because of the coronavirus crisis.
Individuals unable to work due to the countrywide state of emergency imposed on March 13 over the novel coronavirus disease (COVID-19) pandemic can benefit from uncollateralised loans of up to 4,500 levs under the programme if they meet certain requirements, the government said in statement late on Monday.
The loans will have a term of up to five years with a grace period of no less than six months an no more than 24 months. Loan requests will be accepted by the end of the year.
“The decision is part of the measures which the government has taken in order to overcome the economic consequences of the COVID-19 spread. It aims to maintain the employment and economic well-being of employees during a period characterised by a sharp drop in economic activity, closing of enterprises and threat of mass bankruptcies,” the government said.
The programme will be financed with the funds providedto BDB as a capital increase.
The government decided last month to increase the capital of the BDB via cash contributions of up to 700 million levs in order to allow the bank to support businesses affected by the coronavirus pandemic. The measures to be taken by the BDB include the issuance of portfolio guarantees to commercial banks so that they can be more flexible and local small and medium-sized enterprises (SMEs) have easier access to financing, the government said in a statement.
Last week, the BDB launched a new programme in support of startup companies and microenterprises affected by the COVID-19 pandemic. Under the programme, BDB’s unit MFI JOBS will grant working capital loans and lines of credit of up to 48,800 levs with a two-year grace period.
Bulgaria will be in a state of emergency until May 13.