Soft loans extended to companies affected by the war in Ukraine

We remember that the public authorities had set up, in June 2020, an aid scheme in the form of repayable advances and loans at subsidized rates to support the cash flow of companies weakened by the Covid-19 health crisis and which had not found sufficient financing solutions from their bank or other private financing institutions.

This scheme, closed on June 30, 2022. has just been reactivated for companies that are affected by the war in Ukraine. Explanations.

Eligible businesses

The soft loan scheme is intended for small and medium-sized enterprises as well as for large companies (i.e., those with a workforce of more than 5,000 employees and an annual turnover of more than €1,500 million or with a balance sheet total exceeding €2,000 million) that:
- are affected by the war in Ukraine.
- have not obtained a State-Guaranteed Loan (PGE) sufficient to finance their activity.
- justify real prospects for recovery.
- have not been the subject of collective proceedings (safeguard proceedings, receivership or compulsory liquidation).

Form and amount of aid

The aid is granted in the form of a soft loan at a fixed interest rate authorized by the European Commission, the amount of which is limited to:
- 15% of the average total annual turnover made by the company during the last three accounting years. Bearing in mind that where the beneficiary of the loan is a newly created business and it cannot consequently submit three annual accounts, the ceiling of 15% is calculated based on the average total turnover recorded over the period of its existence until the date on which it submits its aid application, if necessary extrapolated over one year.
- or 50% of the energy expenditure incurred by the company during the 12 months preceding the month of the aid application.

However, the amount of the soft loan may be increased to cover the liquidity needs of the business during the 12 months following the date of granting of the loan in the case of an SME, or during the 6 months following the date of granting the loan in the case of a large company. To be eligible for this increase, the company must produce a self-certification establishing its liquidity needs and justify these needs through an independent financial review.

Who to ask for help?

To benefit from the aid, companies must apply to the CODEFI(1) of their area, where is located the subregional Public Finance Directorate or Business Tax Service.

(1) Comité Départemental d’Examen des problèmes de Financement des entreprises