Shop owners and service providers might have easier access to loans. The Industry Ministry is considering extending the guarantees’ programme for operational loans provided by the Czech-Moravian Guarantee and Development Bank (ČMZRB) to retail and services. Currently, only entrepreneurs from construction and industry sectors can apply for loans.
“We are analysing the conditions under which we could extend the programme,” said Tomáš Bartovský, the ministry’s spokesman. ČMZRB expert Josef Vaník told E15 that his institution handed over documents and their standpoint concerning the matter to the ministry. “We are in favour of this move, of course, we have recorded a great demand for guarantees from these sectors in particular,” he said and added that they have not yet received the ministry’s opinion. ČMZRB currently has some CZK 3 billion from the ministry, earmarked for the guarantee programme for operational loans. “Programme extension would not create additional demands on the budget,” Vaník said. He thinks the earmarked amount would be enough to cover the guarantees. The bank has approved guarantees for loans worth CZK 300 million since March, when the programme was launched. According to Lubomír Rajdl, bank’s member of the board, it is the sector restriction preventing greater use of the guarantees. ČMZRB guarantees entrepreneur loans to banks for up to 80% of the loan. If the Industry Ministry decides to extend the guarantees onto other sectors, the bank would be able to accept applications within weeks, according to Vaník. Bartovský was unwilling to give away the date of the decision on the extension. “We know that there is interest in extending the programme, the question now is, how functional that would be,” he said.
Banks are also pushing for the guarantees extension to retail and services. The state guarantee would mean lower risk in operational loan providing. “We have noted interest in state guarantee loans from retail and service sectors that are not covered by the ČMZRB programmes,” said Lucie Kudrnová, head of company marketing at Komerční banka. “We would welcome ČMZRB guarantees extension onto other sectors. We would also welcome if the operational financing also comprised purposes other than reserves,” said Pavla Langová from Česká spořitelna.
Many companies are put off from participating in the programme by its limitation to operational financing of reserve purchases and small tangible property acquisition. “Entrepreneurs have their stores full of reserves that they cannot take advantage of on the market due to the longer time they need to sell and so get into trouble with cash-flow. We would therefore welcome support of operational financing of standing store reserves, which is currently not possible,” said Tomáš Kofroň, Raiffeisenbank spokesman. His bank, too, would welcome the extension of the guarantees onto retail and services. “These sectors are most threatened during current lower demand for services,” he said.
According to ČMZRB information, entrepreneurs mostly use the guarantees for re-financing their standing loans since banks plan to decrease their company loan activity. The guarantees help maintain access to money for entrepreneurs.
