COVID-19 Preferential Credit for Large Companies

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The health crisis to which the world and our country have been exposed has not only affected our health, but also everything to do with social life, the economy and development.

In Chile, there are 7,525 infected with VIDOC-19 and 82 dead so far. The situation will continue to worsen, according to the government, as the number of people infected and killed continues to increase every day. 

For this reason, different measures have been created to prevent the massive spread of the Coronavirus and to mitigate the various negative effects it has caused in the Chilean economy.

One of the main measures is the Economic Plan presented by the Government, which seeks to provide security to SMEs, independent and informal workers and their families. 

With the sagging world economy which affects national and multinational companies, especially those large companies with sales over 1 million UF, President Sebastián Piñera has implemented a series of measures that seek to lift these companies that are in trouble.

New measures for large companies in the words of the President

The representative in the press point said that he is looking for "to create the mechanisms so that the private sector itself can provide the liquidity that these companies require, through something that must be established by law, which is a figure of a credit with supra preference"

Basically, a system of preferential credits will be created, which is generated between the companies and their creditors, but the state provides the tools and legal disposition, to make this situation viable through credits with supra preference.

What does this mean?

"Whoever lends resources to these large companies in these difficult times has a preference over the old creditors." explained Piñera.

I mean...

"Let that creditor who lends money in those circumstances be paid first. With this, the new creditors who are going to put in new, fresh working capital, necessary to face a crisis that has meant that for many months companies have been unable to sell practically anything, are going to have a preference and, therefore, will be paid in advance. said the president.

This COVID-19 line of credit will have the following conditions:

  • 6 months of grace

  • Payment of fees for up to 24 to 48 months.

  • Interest rate 0%

    Maximum central bank monetary policy rate of 3.5% nominal

  • Working Capital Credit

    It will be of a maximum of 3 months of sale in regular period.

Check out the full statement and economic plan here: