16:50 04.04.2017

Kyiv to compensate spending on credit rates to SME under GUF partner banks credits

2 min read
Kyiv to compensate spending on credit rates to SME under GUF partner banks credits

Kyiv City Administration will partially compensate spending of Micro, Small and Medium Enterprises (MSMEs) on the rates paid under credits taken in banks partners of the German Ukrainian Fund (GUF).

The agreement on partnership and cooperation between Kyiv City Administration and GUF on partial compensation of the rates paid under credits provided to MSMEs via GUF partner banks was signed by First Deputy Head of Kyiv City Administration Hennadiy Plis and GUF Executive Director Oleh Strynzha on Tuesday.

"The scheme we would work out says that if a businessman takes a credit in a bank, if this results in the creation of jobs and the jobs pay taxes to the budget in the past six month we are ready to compensate the credit rate. We are actually buying the creation of jobs," Plis said.

GUF Head Andriy Fetsun said that if at the national level GUF partner banks offer credits to MSMEs at 17% per annum, for MSMEs in Kyiv their cost would fall to 10-12%.

Plis said that the funds to partially compensate expenses of MSMEs on credit rates are foreseen in the Kyiv city's budget for 2017.

"The sum in the budget is only the starting sum to work out the scheme. If it starts working we could increase it," he said.

Plis said that the similar program supporting MSMEs was in effect in Kyiv in 2001-2002. Over the period over UAH 200 million was sent to pay the credit rates.

"As far as I know, this helped to attract over UAH 1 billion to the economy. I think that the closure of the program in 2012 is linked to the fact that the city budget had some limits," he said.

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