Cyprus’ government guarantees scheme of €1 billion to support business and the self-employed amid COVID19 crisis, has been launched as of today, following the publication of a relevant decree by the Minister of Finance in the Official Gazette of the Republic.

According to an announcement by the Ministry of Finance, the government guarantees will cover 70% of the losses that may arise from loans and the banks the remaining 30% regardless of whether the loan is secured or not.

The loans will last from three months up to six years excluding current accounts whose maximum duration will be 1 year. The issuance of current accounts and / or loans without any collateral will not exceed fifty percent of the amount issued to Self-Employed and Very Small Business, thirty percent to Small and Medium Enterprises and twenty percent to Big Business.

The Decree contains the criteria and conditions regarding the granting of government guarantees to credit institutions, as well as in relation to the granting of loans to Self - Employed and Businesses, such as the maximum amount of loans that can be granted and the reasons (liquidity, working capital and investments). It also sets low interest rates for new loans, the charge of the guarantee that the Republic will receive on an annual basis from the credit institutions, as well as the control mechanisms.

Loans must be approved by the Credit Institutions by 31/3/2022 and must be disbursed within six months from the date of their approval