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Bulgaria's BDB launches EGF-backed 40 mln euro programme to support local businesses

Bulgaria's BDB launches EGF-backed 40 mln euro programme to support local businesses Photo: Bulgarian Development Bank / All rights reserved.

SOFIA (Bulgaria), September 28 (SeeNews) - The Bulgarian Development Bank (BDB) said on Tuesday that it is launching a 40 million euro ($46.7 million) programme aimed at promoting investment and reducing the negative impact of the coronavirus pandemic on local small and medium-sized enterprises (SMEs), creative industries and start-ups.

The new programme, which is backed by the Pan-European Guarantee Fund (EGF), provides for the granting of direct loans with lower than standard collateral and deductible requirements, depending on the project and the business history of the applicant companies, the BDB said in a statement.

Companies with creative activities, which are among the most affected by the pandemic, can get loans of up to 500,000 levs ($298,600/255,600), as the collateral and minimum deductible is 10% of the amount.

Newly established companies without a credit history, which have the most difficult access to financing, can apply for loans with a ceiling of 250,000 levs, without the need to pledge their property or look for a solvent co-debtor. A guarantee for the bank will be the asset purchased through the loan.

SMEs from all sectors that do not fall into the other two segments can get loans from 100,000 levs to 5 million levs for a period of up to ten years and a grace period of up to 18 months, without collateral and with reduced requirements for own participation - two times lower than the standard levels.

Interest rates on loans under the three programs will be discounted due to European Investment Fund guarantee coverage.

The EGF was established by the EIB Group last year to support EU-based companies affected by the coronavirus crisis.

($ = 0.8564 euro)