Ukraine's Cabinet to launch loan program at low rates for businesses

Ukrainian Prime Minister Oleksiy Honcharuk says the Cabinet of Ministers has adopted a resolution to launch a program under which affordable loans will be provided to businesses at a rate of 5%, 7% or 9% per annum from February 1, 2020.

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"The government incentive program for small- and medium-sized enterprises will allow participants to borrow up to UAH 1.5 million[US$61,652] in affordable loans at 5%, 7% or 9% to create or expand their business operations. The government has identified a mechanism for using budget funds within the Entrepreneurship Development Fund," he wrote on Telegram on January 24, following a government meeting.

According to Honcharuk, the implementation of the program also provides for a number of tools to ensure the availability of loans.

As UNIAN reported earlier, Ukraine's Cabinet of Ministers on December 11 transferred the state's corporate rights in the German-Ukrainian Fund (GUF) to Ukraine's Finance Ministry and allocated UAH 5 billion (US205.5 million) in the GUF's 2020 budget for an affordable lending program for small- and medium-sized enterprises in Ukraine.

The government program offering affordable loans to micro- and small-sized enterprises will start operating on February 1, 2020, under the supervision of the National Bank of Ukraine (NBU).

UNIAN memo. The program for supporting small- and micro-sized enterprises initiated by Ukrainian President Volodymyr Zelensky envisages affordable lending at 5%-9% per annum. In particular, granting loans worth up to UAH 1.5 million (US$61,652) for five years at 5% per annum, if UAH 25 million (about US$1 million) in revenue is expected and at least two jobs are created at a company. A 7% rate per annum is provided for businesses with revenue worth up to UAH 25 million, which do not create new jobs, but the rate will be reduced by 0.5% for each new employee there. Businesses that post up to UAH 50 million (US$2.1 million) will be granted a 9% rate per annum. At the same time, a participant must invest 20% of own funds from all expenses.