The government has approved a loan program COVID III for companies affected by the COVID-19 pandemic. Up to 150,000 entrepreneurs should receive help with 150 billion crowns earmarked for loan guarantees. The Czech-Moravian Guarantee and Development Bank (ČMZRB) will thus be able to guarantee loans of up to CZK 500 billion.
ČMZRB will now issue a call for commercial banks, savings and credit unions to apply and with which ČMZRB will subsequently sign contracts. Therefore, entrepreneurs will process the loan application exclusively at their bank.
Form and amount of financial support
- Self-employed persons and companies with up to 250 employees will be entitled to a guarantee of up to 90 percent.
- Companies with more employees – a maximum of 500 – will receive a guarantee of up to 80 percent.
The duration of the guarantee will be three years and the maximum loan amount will be CZK 50 million. The agreed maturity of the loan may not occur before 1 January 2021, with the exception of loans agreed for an indefinite period.
The selection of eligible transactions is made by cooperating banks. The final beneficiary applies for support in the form of a loan application from a cooperating bank that has a portfolio guarantee agreement with ČMZRB for the COVID III Program.
The guaranteed loan can be used to cover operating expenses, such as wages, rents, energy payments, payment of supplier-customer invoices, acquisition of inventory, materials, etc.
The transaction must meet the following criteria:
- will be implemented on the territory of the Czech Republic, including the capital of Prague,
- does not intend to apply for other public support, de minimis aid for the same guaranteed loan and the guaranteed loan must not be supported by a directly managed European Union instrument,
- was not supported in the COVID Plus program (managed by EGAP).