EU Commission approves Malta’s Interest Rate Subsidy Scheme
EC approves Malta’s Interest Rate Subsidy Scheme
On 14 May, the EU Commission approved Malta’s Interest Rate Subsidy Scheme under the State aid Temporary Framework as extended to date.
The Interest Rate Subsidy Scheme has been launched locally on 16 April and is aimed at supporting businesses facing acute liquidity shortages due to the current COVID-19 pandemic. Through the Scheme, beneficiaries are eligible for a subsidy of up to 2.5% on the interest on loans from banks for the initial two years of the loan. The borrower has to pay an interest rate of at least 0.1% on the loan, net of the guarantee fee. The Scheme is in addition to COVID-19 Guarantee Scheme which guarantees loans granted by commercial banks in Malta to meet new working capital requirements of businesses facing cashflow disruptions due to the COVID-19 pandemic.
According to the Malta Development Bank, which is responsible for the administration of the schemes, the interest rate subsidy will apply automatically to all recipients of working capital loans approved by accredited commercial banks under the COVID-19 Guarantee Scheme.
Businesses wishing to avail themselves of the schemes should contact any of the accredited commercial banks (BOV, APS Bank, MeDirect, Lombard Bank, Izola Bank, FCM Bank and HSBC*).
*HSBC added to the list on 21 May 2020
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