"Funding for Growth Scheme" loans could be available from June
Hungarian banks could start offering small and medium-sized businesses preferential loans under a central bank programme from June 1, Hungarian Banking Association chief secretary Levente Kovács said in Monday's issue of business daily Világgazdaság. The details must still be worked out along with the government's credit guarantee programmes, Kovács said. Lenders' 2% margin on the loans does not even cover risks, say nothing about costs, he added. Under the National Bank of Hungary's recently announced "Funding for Growth Scheme", the central bank will make a combined HUF 500 billion of financing available to banks for SME lending and the conversion of foreign currency-denominated corporate loans into forints. The MNB will lend the money at 0% and banks interest margin will be limited to 2%. Kovács said banks and the government need to reach an agreement on boosting lending activity in exchange for a reduction in the burden on the sector.
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