The first set of guarantees offered by the Official Credit Institution (ICO)which aims to support the liquidity of companies, which we already talked about in a previous article, is endowed with 100,000 million euros this year.
The second, of up to 40,000 million euros is intended to ensure financing for companies and the self-employed in order to both continue to cover liquidity needs and to promote the investments that companies have to make in order to adapt, expand or reopen their production capacities.
As new this year, they are extending the application deadlines – until June 1st – and the repayment of the loans, which can take up to eight years.
Until now and for this second line, as stipulated in the Council of Ministers agreements July 28thY 11/24 Two tranches were activated in 2020 with the following distribution:
- First stretch. 8 billion euros€5,000 million for SMEs and the self-employed and €3,000 million for non-SME companies.
- Second tranche of EUR 2,550 millionintended to ensure the operation of financing for companies and freelancers who are in the process of enforcing the insolvency contract within the framework of insolvency proceedings, but who are fulfilling their obligations under the contract and can prove this by a court or administrator’s report.
First tranche: €8,000 million
The aim of the line is to promote and support the granting of new financing to the self-employed and companies, so that they can primarily make new investments in Spain aimed at adapting, expanding or renewing their production and service capacities or for the resumption or resume its activity.
The guaranteed financing may not be used to pay dividends or interim dividends or for any purpose other than that specified.
It is processed in the same way, self-employed persons, SMEs and companies interested in using this line should contact one of the credit institutions, financial credit institutions, payment institutions or e-money institutions operating in this line.
The financial institution decides on the granting of the appropriate financing to the customer according to its internal procedures and lending and risk policies.
All eligible financing modalities can be guaranteed, these are new loans, Leasing, renting, confirmation and other forms of financing granted to self-employed people and companies of all sectors of activity, based in Spain and affected by the economic impact of COVID-19. More information
The maximum coverage of the guarantee for the self-employed and SMEs is a maximum of 80% of the principal of the operation and for the other companies that are not considered SMEs the coverage is a maximum of 70% of the capital of the operation.
The payback period and the validity of the guarantee correspond to the service life, up to a maximum of 8 years.
Second tranche for companies in agreement with creditors
This tranche is intended to ensure financing operations for companies and self-employed persons who are in the enforcement phase of the insolvency contract as part of insolvency proceedings, but who are able to meet their obligations under the contract and can prove this by means of a court opinion or the administrator.
That Agreement of the Council of Ministers of 24 November 2020 Approve your activation for an amount of 2,550 million euros of the guarantee line established by the Royal Decree-Law 25/2020 of July 3rd.
In this way, those companies that are in the execution phase of the agreement, have cleaned their books and fulfilled the commitments established, but have not yet fully fulfilled the agreement, can access public guarantees under conditions similar to those in other companies Spaniards managed by affected by the Covid-19 crisis.
This section is divided into two subsections:
1) 2.5 billion euros to grant financing by financial institutions to companies and freelancers in the insolvency contract phase, Loans and other transactions granted to contract-stage companies that have a tax residence in Spain and are affected by the economic impact of COVID-19 can be guaranteed.
The maximum nominal amount of the guarantee per customer will have one maximum coverage of 80% of the nominal amount of the loan granted to SMEs and the self-employed and from 70% for non-SME companies.
That Guarantee application deadline It is up to June 1, 2021 and the companies that wish to apply for it must contact the financial institutions that operate in the guarantee line.
The duration of the guarantee provided corresponds to the duration of the operation up to a maximum of 8 years. More information
2.) 50 million euros to guarantee the issuance of promissory note programs integrated with the Alternative Fixed Income Market (MARF). before November 19 (date of entry into force of Royal Legislative Decree 34/2020), issued by companies in the execution phase of the bankruptcy contract, provided that they have been validly renewed and included in the MARF before the granting of guarantees.
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