In connection with the coronavirus pandemic and the state of emergency in the territory of the Slovak Republic, the Slovak Government adopted financial support measures for small and medium-sized enterprises. Via this article, we bring you an overview of the newest information.

FINANCIAL AID TO SUPPORT CONTINUING OPERATIONS IN SMALL OR MEDIUM ENTERPRISES

In order to mitigate the negative consequences of the pandemic and to support the continuation of operations in small and medium-sized enterprises, the Ministry of Finance of the SR may provide financial aid.

Financial aid will be provided through institutions such as the Export-Import Bank of the Slovak Republic and the Slovak Guarantee and Development Bank, a.s. ('the Bank', 'the Financial Institution').

Financial aid will be provided in the form of:

(a) Guarantees for loans granted by a Bank;

b) Payment of interest on the loan provided by a bank, i.e. interest bonuses.

A guarantee for loans provided by a Bank with the aim to mitigate the negative consequences of the pandemic and to support the continued operations of the SME sector – employers,  will consist in satisfying the obligation of the loan agreement between the Bank and the employer if the latter fails to do so.

A loan guarantee may be granted if, at the date of signature of the credit agreement:

• It is not a small employer who is a person who is authorized to mediate employment for a remuneration based on a license issued under the Trade Act no. 455/1991 or is a temporary employment agency.

• The employer has no liabilities to the social security contributions or claims on compulsory old-age pension savings overdue for more than 180 days, or

• the employer has no compulsory public health insurance liabilities overdue for more than 180 days.

• Bankruptcy or restructuring has not been initiated against the employer.

• The employer meets the conditions set by the financial institution, ie the bank.

Interest-rate bonuses may be provided to the employer if:

• he maintains the agreed level of employment for the period specified in the loan agreement between the bank and the employer.

• the company at the end of the fixed period set for maintaining the level of employment will not have any overdue social security contributions, compulsory old-age pension savings contributions or public health insurance contributions above the amount specified in the loan agreement.

At present, they are still finalizing in cooperation with the Ministry of Finance, the exact shape of the loans to be provided by the Export-Import Bank and the Slovak Guarantee and Development Bank, a.s. so we recommend that you check the websites of these banks https://www.eximbanka.sk/ and https://www.szrb.sk/ on a daily basis, as credit withdrawals may be limited.

Tip for clients:

The Slovak Investment Holding a.s. launched on 30 March 2020 a call for financial institutions (commercial banks) to join a financial instrument aimed at providing preferential bridging loans to small and medium-sized enterprises, thus enabling them to implement social measures, in particular by maintaining jobs despite the crisis.

EMPLOYER AND OTHER BUSINESS - NATURAL PERSON

Small and medium-sized enterprises and also self-employed persons (hereinafter referred to as “applicant”, “debtor”) may individually request a creditor / bank or a foreign bank branch to postpone loan repayments for a maximum of 9 months from the due date of the next unpaid loan repayment due after the filing date requests for deferment of loan repayment. The applicant may request a deferral of the same loan repayment during the pandemic period up to one maximum.

If the creditor is a person other than a bank or a foreign bank branch, the debtor may apply for a deferral of the repayment of the loan for a period of not more than 3 months from the due date of the next outstanding repayment of the loan. Subsequently, the creditor may allow a deferral of the repayment of the loan for a maximum of three months if the debtor notifies the creditor of his interest in a further deferment of the repayment of the loan at the latest before the expiry of the original repayment period.

The deferral of loan repayments need not be authorized by the applicant if:

• Is the debtor in delay with the repayment of the loan requesting the deferral of the repayment of the loan more than 30 days before the filing of the request for deferral of the loan,

• As of 29 February 2020, the debtor was in default of at least EUR 100 in a loan repayment of more than 30 days for another loan granted by the same creditor / bank,

• The debtor was in default at the date of the application for deferred repayment (Article 178 of Regulation (EU) No 575/2013 of the European Parliament and of the Council),

• The application for deferment of the repayment of the loan is not duly completed; or

• The application for deferment of the loan repayment does not contain particulars according to the model of the application.

The granting of a deferral of a loan repayment is considered to be a modification of the credit agreement without the need to conclude an amendment to the contract and the processing of the deferral will be free of charge.

The loan repayment deferral will not apply to overdraft loans (overdrafts allowed) and credit cards.

The applicant for deferral of loan repayments will not be included in the database of credit debtors, it means that it will not have a negative record in the credit register that could impede the granting of a new loan in the future.

You can ask your bank to postpone the loan installments in person, or you can file an application for postponement of the loan installments electronically using the forms published on the websites of commercial banks.

CONCLUSION:

We are constantly monitoring the situation and we will inform you in good time about new facts. If you have any questions or requests, please do not hesitate to contact VGD SLOVAKIA s.r.o. For more information, visit our website, facebook page or Linked-In profile.