Government will approve another line of ICO loans for 40 billion tomorrow

2020/07/27 07:46:32 Written by Canarian Weekly Business

The Council of Ministers will formalize the agreement tomorrow, to launch the new line of guarantees of the Official Credit Institute (ICO), to the value of 40 billion euros for companies after the first line of 100 billion has been exhausted, but financing needs to continue.

This new line of credits are not only intended to finance working capital, but also to boost investment activity and encourage it in areas where greater added value is generated, around two main axes: environmental sustainability and digitization.

After the end of the state of alarm, and the consequences derived from the restrictions on activity and mobility imposed, the Executive has launched a second phase of economic and social measures to promote reactivation. The specific requirements of this new section, the percentage of coverage or the sections, will be approved next Tuesday.

Given the high use of the previous line of guarantees of 100 billion euros, approved on March 17th and intended to cover liquidity needs, and the "optimal" operation of the public-private collaboration model, the Executive plans to replicate the approval and management mode, in order to optimize resources and the capillarity of the arrival of funds in the productive fabric of the economy.

Until last Wednesday, the latest data showed that the ICO line of guarantees already unlocked, had exceeded billion euros in financing, of which SMEs and the self-employed have carried out 97% of operations, with a mobilization of more than 50 billion in guarantees, and more than 62.5 billion in access to liquidity, to meet daily business needs.

These guarantees can be requested until September 30th exclusively by companies affected by the economic effects of Covid-19, provided that the applicants were not in default on December 31st 2019, and in bankruptcy procedure on March 17th 2020.