Small, medium businesses to get subsidized loans for investment at 3-4.5% - PM

MOSCOW. Aug 8 (Interfax) - The Russian government has prepared proposals to reduce borrowing costs for small and medium enterprises (SME) that, at the current key interest rate, would enable small businesses to obtain loans for investment purposes at 4.5% during the grace period and medium businesses to get loans at 3%, Prime Minister Mikhail Mishustin said at a meeting with deputy prime ministers.

Economic Development Minister Maxim Reshetnikov said that the program to subsidize interest rates under the SME national project and subsidized funding for the program to stimulate lending will be combined on a pilot basis.

"As a result, business will be able to get an investment loan, for example to buy equipment or repairs, launch new production facilities, for a period of up to ten years. And the grace period is up to five years. During the grace period, the rate will be 3% for medium businesses and 4.5% for small and micro businesses given the current key rate of 8%," Reshetnikov said.

Manufacturing, processing of agricultural products, logistics and the hotel business have been identified as priority sectors for the program.

Funding for the program will total up to 50 billion rubles to the end of 2022. The new lending program will be operated by MSP Corporation.