Bank of Russia changes parameters of SME lending facility
Due to the key rate cut to 9.5%, the Bank of Russia made a decision to return to the parameters of funding for banks participating in the SME Lending Incentive Programme (hereinafter, the Programme) which were effective until 15 March 2022.
After the significant key rate increase to 20% per annum on 28 February 2022, the Bank of Russia set a fixed interest rate of 9.5% per annum on loans issued to banks under the main Programme and launched an additional temporary working capital lending programme at a fixed rate of 9.5% as well.
From 15 July 2022, under the main Programme, the Bank of Russia will issue loans to banks at the key rate reduced by 1.5 percentage points. The funding rate for banks on loans issued earlier under the Programme at a higher interest rate will be reduced in a similar way.
The maximum interest rate for ultimate borrowers under the Programme will be set at the level of the key rate increased by 3 percentage points. Furthermore, the Bank of Russia will cancel the restrictions on issuing working capital loans under the main Programme which were introduced due to the launch of the temporary working capital lending programme.
Credit institutions may continue lending to borrowers under the current terms of the Programme until 15 July 2022.
To implement the main Programme, the Bank of Russia will allocate 100 billion rubles above the limit actually used as of 15 July 2022.
The parameters of the temporary working capital lending programme do not change.
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