COVID III guarantee programme will support businesses with up to 500 employees
On 18 May 2020, the Government announced the COVID III programme to support entrepreneurs whose business activities have been limited as a result of COVID-19 and the corresponding protective measures. Although the programme follows on from the previously announced COVID I and COVID II programmes, there are several important differences.
Unlike its predecessors, COVID III will provide support not only for small and medium-sized enterprises but also for big companies with up to 500 employees (the number of employees must be proved separately for each applicant). This time, the programme will have countrywide scope and will thus also help businesses seated in Prague. The way of applying for support also changes this time. While in the first two programmes, the business was to contact the Czech-Moravian Guarantee and Development Bank (CMZRB) directly, under COVID III it must pre-negotiate the loan with its own bank, which will then complete the application with the CMZRB. The Government will provide 30% guarantees in an aggregate amount of CZK 150 billion, which makes it possible to support loans in a volume of up to CZK 500 billion.
The specific parameters then depend on the size of the business. While for businesses with up to 250 employees, the State guarantee will cover 90% of the principal amount of an individual loan, for companies with up to 500 employees, this ratio will be 80%. In both cases, the maximum amount of the loan is CZK 50 million and the duration of the guarantee will not exceed three years.
The programme is aimed at covering operating expenses, such as salaries, rents, payments for utilities, supplier-customer invoices and procurement of inventories and materials. Do not hesitate to contact us for help with preparing an application.