loans guaranteed by the Greek government

Do you have a business that was hit by the pandemic and you want to cover its operational needs? Have you had the misfortune of entering the business arena in 2020 or 2021 and bumped into the worst times in decades?

Now, you have the possibility to secure preferential financing with an 80% Guarantee of the Greek government, through the initiative run by the "Covid-19 Business Guarantee Fund" of the Hellenic Development Bank.

Check all the available sources of financing that can help you cope with the difficulties until the economic activity recovers, the conditions and characteristics of the loans.

What are loans with a Greek government guarantee?

What does "guarantee of the Greek government" mean?

Loans guaranteed by the Greek government are essentially a lending model. Through this, the State puts its back, i.e. offers guarantees, to make it easier for banks to grant loans.

In the specific program e.g. the guarantee of the Greek government is at 80%, which means two things:

A) that the company must cover 20% of the loan with guarantees

B) the bank is covered for 80% of the loan by the government

Therefore, the chances of the loan being approved – which is given on favorable terms – are greatly increased, but also of not going red, making it easier for both the borrower and the bank.

The financing concerns exclusively the granting of working capital loans, with a favorable interest rate due to the Fund's guarantee of 80%, to support the increased liquidity needs of businesses arising as a result of the current situation created due to COVID 19.

Who is this loan for?

Small, micro and medium enterprises that:

  • have an annual turnover that during the last management year does not exceed 50 million euros or assets that do not exceed 43 million euros
  • employ during the reference year, less than 250 workers (calculation in Annual Employment Units E.M.E.)
  • Large enterprises whose annual turnover and employed personnel exceed the sizes of the SME category.

In other words, the loan with a guarantee from the Greek government does not concern the needs of the house, which you would satisfy with a consumer or housing loan .

What criteria must businesses meet?

  • Regardless of the size of the business, the following conditions must be met cumulatively:
  • It must be a business that operates legally in Greece.
  • Not be considered problematic on 31.12.2019 (as referred to in point 18 of article 2 of Regulation 651/2014).
  • To be considered creditworthy in accordance with the applicable credit policy and the Bank's internal procedures.
  • Be informed on 31.12.2019 or 29.2.2020. Up-to-date credit for the needs of this Action is that which does not exceed 90 days with a reference point of 31.12.2019 or the date of submission of the application.
  • That there are no grounds for excluding Article 40 of Law 4488/17 (A 137/139/17), as applicable.
  • Not to be pending against the recovery order of previous illegal and incompatible state aid based on an EU or CJEU decision.
  • As long as it has been included in programs of the Hellenic Development Bank (formerly ETEAN) that have expired or are in force, that it has not shown adverse transactional behavior in the repayment of the said programs of E.A.T. (loan cancellation or overdue debts of more than ninety (90) days).

For the case of a business that has shown unfavorable transactional behavior in relation to the above, E.A.T. may approve a request for a loan under the "Covid-19 Business Guarantee Fund" Round 2, provided that:

  • this is a Guarantee Program and the guarantee amount owed by EAT has not been paid or
  • has paid off its debt in full before submitting the financing application or
  • since the debt in question has been confirmed to the competent D.O.Y., it has been included in a regulatory regime, which continues to be in force on the date of submission of the financing application.
  • does not exceed the aid limit set by the temporary framework for State aid measures to support the economy during the current outbreak of the Covid-19 disease.
  • is tax and insurance aware at the time of disbursement.

Which businesses are exempt?

Excluded from participating in the program are companies active in the production and trade of arms and ammunition, in the manufacture, processing and trade of tobacco and tobacco products, in genetically modified foods and in illegal activities according to national law.

What are the characteristics of the loan guaranteed by the Greek government?

Duration: Up to 5 years (60 months)

Maximum loan amount:

For businesses established by 31/12/2019, the lesser of the following amounts will not exceed: 000 euros or 25% of the total turnover of the business in the year 2019.
For businesses established within 2020 or 2021 the amount of the loan will not exceed the lesser of the following amounts: 000 euros or the amount resulting from the liquidity needs that must be covered by the beneficiary from the date of granting the loan and for the next 18 months and which must are demonstrated with sufficient justification and documentation.

👉 Guarantee rate: 80%

👉 Grace period: Up to 6 months

👉 Interest rate: 6-month Euribor base rate (limited to zero, in case of a negative price) plus a margin, as will be determined per borrowing company and levy of Law 128/75.

👉 Periodicity of installments: Quarterly or six months

👉 Disbursements: Sectional or lump sum

👉 Deadline for disbursements: Until December 31, 2021

👉 How to apply: The application will be submitted on the website www.ependyseis.gr, and then the company will submit its physical file for evaluation to the bank.

What else do you need to know about loans with a guarantee from the Greek government?

  • Loans guaranteed by the Greek government must be treated like any other loan. It is not money given away, but money to be paid back.
  • The program is co-financed by the European Regional Development Fund (ERDF) and the Greek State, and with the contribution of the Operational Program Competitiveness, Entrepreneurship and Innovation (EPANEK).

And now you know! For your business, you may even be entitled to a loan with a Greek government guarantee. But for your personal needs, there are various consumer loans that might make sense to consider.

Compare loans for free on our platform, online and without queuing at the bank. Learn information, find the banking product that suits you and when you're ready, proceed!