Hungary's central bank on Thursday announced a new lending programme called the Funding for Growth Scheme, to improve the financing conditions for small and medium-sized firms.
Newly appointed Magyar Nemzeti Bank chief Gyorgy Matolcsy said the central bank will provide refinancing loans with a preferential interest rate for commercial banks for a temporary period. The HUF 250 billion lending scheme will have zero percent interest rate.
The financial institutions that take part in the programme will in turn provide loans to small and medium-sized enterprises, with a maximum interest rate of 2 percent.
Also the central bank intends to provide a limited amount of preferential refinancing loans for the conversion of SME's outstanding foreign currency loans into forints. The bank intends to use its reserves to help SMEs to pay off their foreign denominated debt.
At the same time, it suspended the two-year secured loan tender for an indefinite period of time.
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