The COVID-19 Business Guarantee Fund was created to support businesses' access to borrowed funds, through the provision of collateral, in a capped portfolio. The aim of the fund is to mitigate the impact of the COVID-19 pandemic on the operation of businesses by enhancing their liquidity with working capital loans.

The loans will be granted to small, medium and large enterprises, no later than 30/06/2022 and are expected to approach €2.5 billion in cycle B. while in the third cycle the 500 million euros. euro. More than €3.5 billion in loans were approved and granted under the first cycle. euros. The total amount of loans in all three cycles that businesses will receive will exceed EUR 6.5 billion. euro.

For the first & second cycle of the Action, the resources of the Fund are co-financed by the European Regional Development Fund (ERDF) and the Greek State, part of which comes from the Operational Program Competitiveness, Entrepreneurship and Innovation (EPAnEK) 2014-2020. The third cycle of the Action is funded as part of the Union's response to the COVID-19 pandemic - React EU.

To whom the Guarantee Fund is addressed

All companies legally operating in Greece, except offshore companies, holding companies in other companies, companies in the financial sector, public bodies and their subsidiaries, local authorities and their subsidiaries.

Businesses should: not be considered "in difficulty" on 31/12/2019. If the company (regardless of size) was in difficulty on 31/12/2019 and has taken corrective action before applying for funding, it is possible to receive aid through the Temporary Framework for State aid measures.

Especially for micro and small enterprises, regardless of whether they were problematic on 31 December 2019 should not have been subject to collective insolvency proceedings under national law and have not received rescue aid or restructuring aid;, be established up to and including the time the application for funding is submitted to the bank, be considered creditworthy, in accordance with the applicable credit policy and internal procedures of the credit institutions; be bank-aware (have a debt < 90 days) on the date of the application or on 31 December 2019, there are no grounds for exclusion under Article 40 of the Law. 4488/17 (A 137/139/17) (fines imposed, penalties for violations by the competent control bodies of the Labour Inspection Body for violations of labour legislation), there is no pending recovery order for previous illegal and incompatible state aid based on an EU or CJEU decision.

For businesses that have joined previous programs of the Hellenic Development Bank, either those that have expired or those that are in force, the basic condition is that they have not shown unfavorable transactional behavior in the repayment of their debts. In the event that they have exhibited unfavorable trading behavior in the past, they should have paid their debts in full before submitting the application for funding.

Submission period

The closing date for applications is 30 June 2022.

Business requests are first submitted to the electronic platform www.ependyseis.gr and after the finalization of the submission, the companies submit their funding requests for evaluation to the cooperating Banks – Financial Institutions.

For more information, those interested in the loan from the Guarantee Fund can contact the Hellenic Development Bank, as well as the bank of their choice. Cooperating banks to which interested businesses can turn after submitting their application on the website www.ependyseis.gr : National Bank of Greece, Piraeus Bank, Eurobank, Alpha Bank, Attica Bank, Optima Bank, Cooperative Bank of Epirus, Pancretan Cooperative Bank, Cooperative Bank of Thessaly, Cooperative Bank of Karditsa, Cooperative Bank of Central Macedonia, Cooperative Bank of Chania.

Type of aid

Loan guarantee

Application area

All over Greece

What is funded by the Guarantee Fund

Loans eligible for guarantee should have the following characteristics:

Loans to be concluded until 30/06/2022. The purpose of granting the loans will be working capital. Loans (including non-convertible PVs) with a maturity of up to 5 years including any grace period. The loans will be for new business financing. It is forbidden to refinance/repay existing loans and credit lines, to finance a dividend payment program or share purchase, and to finance acquisitions and mergers.

85% of the new loans of the second cycle are addressed with absolute priority to medium, small and micro enterprises in the country that have been affected by the economic impact of the pandemic, while theLoans of the third cycle are addressed exclusively to Very Small Enterprises with a turnover of up to 1,000,000 euros and a maximum loan amount of up to 250,000 euros.

Loan amount

There is no threshold on the requested loan amount.

The maximum amount that a company can request is as follows: Double the annual wage costs of the enterprise (including social security contributions, as well as the cost of staff working on the premises of the enterprise, but officially included in the payroll statements of subcontractors) for 2019.

In the case of enterprises created after 1 January 2019, the maximum loan it must not exceed the estimated annual wage cost for the first two years of its operation or 25% of its total turnover; of the undertaking in the year 2019 or after documentation and on the basis of a justification and a plan setting out the liquidity needs of the beneficiary, the amount of the loan may be increased beyond the above limits I and II to cover the liquidity needs from the date of granting the loan and for the next 18 months for the small and medium-sized enterprise and the self-employed and for the next 12 months for a large enterprise.

Loan interest rate

The interest rate on the loans is borne by the borrower and can be agreed on a variable or fixed basis and will depend on the pricing policy of each cooperating XO, taking into account the mechanism for passing on the benefit of the guarantee to the final recipient.

Guarantees

The guarantee provided relates to new loans to be granted up to and including 31 December 2021. The term 'grant' means the time at which such loans are disbursed. The guarantee covers the loan for its entire duration and until the full and complete repayment of any debt under the loan. The warranty has a five-year duration. The forfeiture request, however, can be submitted until 31/12/2027, if the fact of late payment has occurred until 31/12/2026. The commission of the guarantee paid by the undertakings is fully subsidized in the three rounds of the Fund, subject to the limitations of State aid.

The State aid scheme to which the three cycles of the Fund fall is the "Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak".

Budget from the Guarantee Fund

The budget amounts to 2,000,000,000 euros (€1 billion from the first cycle, EUR 780 million. from the second cycle and 220 million euros. from the third cycle of the Action). For the grant of the guarantee fee, the financial contribution of resources of up to 250,000,000 euros through the Public Investment Program is maintained.