On 25 March 2020, the government presented a proposal for a loan guarantee primarily for small and medium-sized enterprises. The proposal aims to facilitate financing for businesses and involves a loan guarantee for companies negatively affected by the coronarivirus outbreak.
The proposal means that a guarantee will be issued to the banks, which in turn will issue guaranteed loans to companies. The state will secure 70 per cent of new loans to companies affected by economic difficulties due to the coronavirus. In practice, this means that banks will be reimbursed up to 70 per cent of any loss incurred on the loan to which the guarantee relates.
The government proposed a limit of 75 million kronor per borrower and that it should primarily target small and medium-sized enterprises., However, there is no formal company size requirement to participate in the programme.
The requirement to participate in the programme is that the company must have been negatively affected economically as a result of the new coronavirus. It is also not expected that the guaranteed loans will be used for anything other than what can be equated to a normal salary withdrawal, for example, the loans shall not be used for bonuses and variable remuneration to senior executives etc.
The companies are applying for loans from the banks that have chosen to participate in the programme. A standard credit check will be carried out when you apply.
Banks will pay the Swedish National Debt Office a risk-based guarantee fee based on the borrower's current risk class. The risk class is determined by the banks in accordance with their credit assessment processes.
Regarding interest, this is paid by the borrower to the bank as usual. The interest rate is determined by the bank, taking into account the credit risk assessment they have made of the individual company; the portion of the loan guaranteed by the state shall also be considered in the calculation.
During the first 12 months, the borrower is entitled to a deferral of interest.
If you require assistance in accessing any of the government's support packages, please contact your MOORE representative or your local MOORE office.
