Question Time – Liquidity Law Decree (art. 13) – Central SME Guarantee Fund

May 5, 2020

Q: I am the owner of a small / medium-size enterprise (SME) can I access the Central SME Guarantee Fund to guarantee my financing? 

Yes, the Central SME Guarantee Fund (or “Fund”) is an instrument set up by the State to allow SMEs’ access to finance through a public guarantee on money granted by banks.

Q: What are the characteristics of the Fund guarantee?

The guarantee is granted free of charge. The maximum amount guaranteed is Euro 5 million, against requests for funding which must not exceed (i) twice the beneficiary’s cost of personnel in 2019 (ii) 25% of the beneficiary’s total turnover in 2019 (iii) the need for working capital and investment costs in the following 12/18 months as certified by a self-certification of the owner of the enterprise.

Q.: I am the owner of a SME which received financing assisted by the Fund: can I refinance it?

Yes, the Fund applies to the rescheduling of the beneficiary’s debt, provided that the new loan is granted to the same entity and the additional credit is at least 10% higher than the outstanding debt under the rescheduled loan.

 Q: What are the size requirementsf for SME in order to access the guarantee of the Fund? 

Enterprises with less than 500 employees are eligible for the guarantee.

 Q: Is it possible for a company admitted to composition agreements with creditors to avoid bankruptcy, to be admitted to the guarantee of the Fund?

The guarantee may be granted provided that (i) the company’s exposure cannot be classified as non performing under banking regulations; (ii) there are no amounts due in arrears; (iii) there is reasonable certainty that the exposure will be repaid when due.

Q: How do I access the guarantee from the Fund? 

You must apply for it when applying to the bank for the loan. In the event that the anti-mafia documentation is not available immediately, the guarantee may be granted under a condition subsequent. In the event that the anti-mafia documentation subsequently provided reveals the presence of a disqualification case, the guarantee will be revoked.

Q: I am an entrepreneur in the tourist-hotel industry and I would like to ask for financing for a real estate investment in my sector: is there any provision that applies to me?

Yes, if the financing has a minimum duration of 10 years and is for an amount higher than 500,000 Euros the guarantee of the Fund can be cumulated with other guarantees.

 Q: I am an entrepreneur in the agricultur sector – do the benefits provided by the Liquidity Decree apply to me?

Yes, the provisions laid down for the extension of the Fund apply, as compatible, to guarantees given by ISMEA (Istituto di Servizi per il Mercato Agricolo Alimentare) against medium and long-term bank loans in favor of agricultural and fisheries enterprises.

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