02 december 2020
19:36
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A draft Royal Decree by Minister of Finance Vincent Van Peteghem (CD&V) to extend the guaranteed loans for SMEs until 30 June 2021 is on the table. This once again sets in motion the bazooka, which should allow SMEs to weather the corona crisis.
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The Van Peteghem cabinet is still holding back the boat. “It is still under discussion,” it says. But it is no secret that work is being done on further fine-tuning of the € 50 billion bazooka, which was launched at the start of the corona crisis. The De Croo government decided at the beginning of November that work would be done on an extension of the guarantee scheme for SMEs and credit insurance until June 30, 2021.
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The draft Royal Decree states that the extension is necessary to continue to ensure access to finance for SMEs. ‘The new severe wave of the coronavirus in the fall has meant that many SMEs have had to strongly restrict or even close their activities again. Due to the seriousness and the longer duration of the negative effects of the coronavirus on the economy, it is desirable to extend this State guarantee until June 2021. After all, support remains necessary to ensure access to finance for SMEs. ‘
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Pain points
In consultation with the banking world, some issues have been addressed that led to the first € 50 billion bazooka launched in March. no direct hit used to be. All in all, the banks made little use of the state guarantees when granting loans, as the governor of the National Bank Pierre Wunsch gave earlier in parliament. The risks were still too much with the banks themselves, it sounds in financial circles.
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Adjustments were made in the summer. The maturity of the guaranteed loans was increased from one to three years, giving companies more time to repay the loans and limiting the potential losses for the banks. That bazooka 2.0 was also more popular, but by then the worst of the first corona wave was already over. We are now in the middle of a second corona crisis, which means that work has been done on an extension until 30 June 2021.
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Credit up to five years
The bazooka 3.0 offers the possibility to also offer loans of more than three years to SMEs. The maximum term is increased to five years. On the other hand, customers have to pay a fee of 100 basis points for the term over three years. For the first three years, the compensation remains at 50 basis points. Anyone who receives a loan with a state guarantee will therefore have to pay a fee to the state on top of the normal interest (of a maximum of 2%). This is 0.5 percent in the first three years and 1 percent after three years.
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