Government measures in key jurisdictions 3rd edition final - Flipbook - Page 48
Annika Schauman | annika.schauman@hannessnellman.com |
+358 9 2288 4330
Loans and
financial
support
Has the
government put in
place any new
bank funding
schemes?
The Finnish Government has introduced a range of financial schemes for impacted businesses who
are experiencing financial difficulties during the COVID-19 pandemic. As the spread of the pandemic
has slowed down in Finland and restrictions have been lifted, some of the schemes have already been
closed.
The support schemes that are currently available include the following:
•
- the state guarantees for bank loans, which can be used for working
capital needs caused by the COVID-19 pandemic. Guarantees are granted by Finnvera (a stateowned specialised financing company) for up to 80% of the bank loan and no collateral is required.
•
- a funding program to support
MidCap companies who are in temporary financial difficulties due to the COVID-19 pandemic.
Finnish Industry Investment Ltd (a state-owned investment company) will make capital
investments of EUR 1-10 million into companies with a minimum of EUR 10 million turnover and
over 50 employees. The company must have the ability to survive the financial difficulties caused
by the crisis and the investment is subject to standard due diligence.
•
- direct support consisting of two parts:
Compensation for restrictions for business: Compensation is based on the decrease in sales caused
by the Government restrictions. Can be used to pay for rent and fixed running costs (excluding
material purchases, labour costs and investment costs).
The amount of the compensation is 15% of the decrease in the company's sales during the period
4 April - 31 May 2020 compared to the average sales in January-February 2020 or April-May 2019
(whichever is greater). The maximum amount of compensation is EUR 500,000 per applicant.
Support for re-employment: EUR 1,000 per employee.
•
- direct support for businesses, which
have experienced a distinct decrease in turnover due to the COVID-19 pandemic. The support will
be granted by the State Treasury. This new act on the support for business costs has been
approved by Parliament and enters into force 1 July 2020.
•
- both the Bank of Finland and the State Pension
Fund of Finland have agreed to increase their investment in domestic corporate papers.
•
- Finnish banks have agreed to give interestonly payment periods (of up to one year) on mortgages and other loans for individuals and
companies in financial difficulties due to the COVID-10 pandemic.
•
- temporary decrease on the amount of permitted interest
on consumer credits from 20% to 10% per annum. Direct marketing (e.g. marketing by telephone
or emails) of consumer credits is also restricted. The temporary measures are expected to remain
in force until the end of 2020.
•
- In addition to the above financial support,
certain payment arrangements have been agreed by the Tax Administration and between the
Government and the Pension Insurance Companies. These include measures such as
postponement of payments deadlines, extension of tax return deadlines, removal of late payment
penalties and temporary reductions of pension insurance payments.
In addition to the above, there are a number of smaller support packages put in place, including
support for sole entrepreneurs, for small agricultural businesses and for the primary agricultural
sector and fisheries section.
48
Government measures in key jurisdictions