Malta Development Bank facilitates bank loan scheme for small businesses
In the aftermath of Covid-19 and the economic realities that it brought about, the Malta Development Bank has introduced an initiative aimed at supporting businesses so that small businesses that apply for bank loans do not need to provide personal guarantees on these loans. The Chairman of the Malta Development Bank Professor Josef Bonnici told Television Malta that this measure would strongly impact the sector allowing businesses to continue to operate smoothly.
The pandemic has dug deep holes in the pockets of businesses especially small and medium-sized ones, with many having to adapt to the new reality to avoid redundancies and negative bank balances. In light of these difficulties and to support businesses, the Malta Development Bank has launched a scheme so that businesses applying for bank loans under the Covid-19 scheme do not need to provide personal collateral.
The Chairman of the Bank Professor Josef Bonnici told Television Malta that small businesses were the engine of the Maltese economy and at this critical moment an additional incentive had to be given to the Maltese economy to ensure the liquidity for Maltese businessmen.
“In the case of SMEs, they were being asked for the remaining ten per cent out of 90 and were being asked to make good for the remaining 10 per cent. Now we will be also make good for that 10 per cent to reduce the burden on and to help them get back on track. ”
This scheme applies to loans up to € 250,000 which were concluded from 29 July, but banks may also amend contracts signed before this date to reflect the new conditions. Professor Bonnici said that this amount reflected the needs of the businesses and in fact two hundred million had already been disbursed on this scheme while another 600 million have been allocated.
Professor Bonnici said that this scheme was approved by the European Commission at the end of last month under the Temporary State Aid Framework in the context of aid to the economy as a result of the pandemic. .