Turkey’s Credit Guarantee Fund (KGF) has announced a new loan support package to facilitate the businesses of the small- and medium-sized enterprises (SMEs) while shielding employment from the COVID-19 effects on the economy, the fund said in a statement Tuesday.
The KGF prepared the loan support package for SMEs worth around TL 7.5 billion ($960 million) within the scope of the Competitiveness Program of Enterprises and SMEs (COSME) carried out through the European Investment Fund (EIF). Accordingly, SMEs will be able to use up to TL 1.125 million in loans with a one-year grace period and a maturity of up to 60 months, with an 80% KGF guarantee.
The interest rate of the loans will be determined by the banks depending on the market conditions.
According to the statement made by the KGF, the EIF will contribute TL 300 million and the KGF will contribute TL 300 million to the fund to be used for SMEs. With these contributions, a total of TL 6 million in guarantee and TL 7.5 billion in loans will be made available.
KGF General Manager Kasım Akdeniz said in the statement that the support package is a continuation of the protocol signed within the COSME Program carried out through the EIF within the scope of the budget provided by the European Commission to increase the competitiveness of the SMEs.
Akdeniz said that the aim is to increase the production and competitiveness of SMEs along with contributing to employment. He noted: “We are aware of the importance of access to finance for the sustainability of cash flow, production and employment, especially during the pandemic period we are living through."
He added that they will prioritize the use of the loan for firms creating high-value-added production.
