Banks’ support to businesses in times of corona increases to 28 billion euros
Over 37,000 businesses have received a larger credit, with a combined value of 24.9 billion euros. Over 6200 loans have been provided with a government guarantee. Altogether, 1.7 billion euros has been made available through the different corona guarantee schemes, such as the Corona SME credit guarantee scheme (BMKB-C), the finance guarantee (GO-C) and the Small Credits for Corona guarantee scheme (KKC). So far, 129,000 companies have received a postponement of loan repayments from their bank: totalling 3.1 billion euros. Banks are now offering customized support instead of collective postponements.
Corona Monitor English (pdf)
Corona Monitor English (jpg)
“Banks keep a close eye on the situation and they proactively contact customers when there are signals that they might be negatively affected by the COVID-crisis. There are no widespread liquidity problems at the moment, however, this could quickly change,” says Chris Buijink, President of the NVB.
“The second partial lockdown affects specific groups of clients especially hard. This particularly concerns companies that have been forced to use their reserves since March. We know that in specific sectors, which have been faced with long-term constraints, there are companies which will not be able to survive the second partial lockdown. We urge customers to not wait with asking for support, but to reach out to their bank. Banks’ doors are open to discuss the possibilities for assisting customers; it is a matter of customized service. Nevertheless, banks cannot do it alone; governmental support for affected sectors remains essential. We are therefore pleased with the government’s announcement of further support measures. The starting point for lending remains that there must be a perspective of returning to a healthy situation, so that the financing remains responsible” says Buijink.
So far, almost 36,000 consumers received a pause for their mortgage payment or personal loan. In most cases this concerns a payment break of one to three months. This totals a combined value of 85 million euros – an increase from 80 billion compared to four weeks ago. Consumers who want to receive a payment break for mortgage interest relief should notify this to their mortgage provider by 31 December 2020.
A payment break on the mortgage or consumer loan is a temporary relief solution with which, for example, loss of income can be cushioned for several months. However, if customers foresee a more structural payment problem, for example due to unemployment, it is wise to (re) enter into a conversation with their bank. Together with the customer, the bank will look for a suitable and more long-term solution which is also tailored to the specific situation of the customer. An important principle is that banks want to protect customers against financial burdens which they ultimately cannot bear.