MoE is going to transform program of affordable loans

This was stated by Deputy Minister of Economy of Ukraine Nadiia Bihun on the air of the Ukrinform program "Samokhvalov Asks".

"We are planning to make changes to the "5-7-9" program to focus it on recycling now. That is, to make recycling the priority sector of this program," said Bihun.

She recalled that the "Affordable Loans 5-7-9%" program was originally aimed at business enterprises, but COVID-19 broke out almost immediately, followed by a full-scale war, which required this program to save businesses.

"But now we see that we need to move away from this concept," said Bihun.

The deputy minister explained that when there is a program where the loan rate is significantly lower than the market rate, it encourages businesses to participate in it, and thus creates a huge demand. Instead, it is the bank that decides whom to lend to - someone with a good financial standing who will definitely repay the loan, or a more risky entrepreneur. So, of course, the answer is obvious: the bank will choose the latter. And businesses that really needed help had no chance of getting financial assistance.

"That is why we are going to change the program more actively. In fact, there will be two key areas. One area is for businesses that want to develop, which will take money for investment purposes, and the second is for businesses that really need help, the de-occupied territories," said Bihun.

As reported, the program "Affordable Loans 5-7-9%" was launched in Ukraine on February 1, 2020. The program is being implemented by the Entrepreneurship Development Fund (EDF), whose sole participant is the Government of Ukraine represented by the Ministry of Finance. The SPF has entered into cooperation agreements with 45 banks.