The crisis surrounding Covid-19 is hurting the middle market. We show you how to secure liquidity through financial aid and support your business.
Corona and the Mittelstand: The Situation
The economic damage that companies will suffer in the wake of the partial shutdown is currently unforeseeable. It is not only manufacturing industries that are already feeling the impact of Corona and the resulting lockdown, which is having a massive impact on supply chains. Traders, tourism operators, and other service providers also suffer losses due to the consequences of virus containment measures. Large concerns and also small and middle enterprises stand before an uncertain time – the focus should remain now on a safety device of the liquidity in the own enterprise. And our financial partners already react with packages of measures.
Concrete measures: How banks and politicians are reacting
The German government is aware of the seriousness of the situation, so that KfW, the development bank, is leading the way with a comprehensive package to support companies throughout Germany. And also the development bank from North Rhine-Westphalia, the NRW.BANK, has adapted a funding program. The focus here is on providing farms with liquid funds in the short term and thus improving the sometimes tense situation, which does not always mean short-time work and co. can be mastered. To this end, KfW will, on the one hand, continue to use existing funding offers and improve their access terms and conditions in the course of the Corona expansion. Part of these programs is the KfW Entrepreneur Loan with a recent 90% liability exemption, where now, for example, an opening of the liability exemption also for large companies with an annual turnover of up to 2 billion. EUR is made.
Further, this includes the KfW loan for growth with 70% release from liability, which is temporarily limited to general corporate financing incl. Operating funds will be expanded through consortium funding. So far, the loan has been limited to investments in innovation and digitization. And packages are also planned for young companies: The ERP Start-up Loan – Universal now includes risk assumptions of now also up to 90% for the on-lending financing partners (usually the house banks) for working capital loans up to 200 million. EUR. Higher risk-taking may make financing partners more willing to lend.
North Rhine-Westphalia's development bank, the NRW.BANK, has extended a funding program specifically for companies in NRW. The NRW.BANK-Universalkredit can now also be used to finance working capital and investments. Risk assumption was temporarily increased from 50 % to 80. In addition, the commitment for the development loan is made to the commercial bank according to NRW.BANK up to a sum of 250.000 euros within 72 hours.
Help credit because of Corona for businesses: How to get help as quickly as possible
Companies, the self-employed and freelancers who wish to take advantage of financing from one of the KfW programs listed can do so conveniently via the COMPEON portal. For this purpose, we specifically approach house banks and commercial banks and inform them about the funding request and/or. Check which support programs are particularly suitable for a company's financing project.
And more of our financial partners are also sending clear signals to entrepreneurs. So assures HVB board member Markus Beumer:
"We are responding quickly and decisively to support our middle market customers who are currently facing challenges due to Corona…including, for example, interim financing, bridge loans or extended repayment periods."
Markus Beumer, HVB Board Member
A possible way to secure the company
Entrepreneurs who are now looking for a quick and binding means of securing liquidity can find other places to turn to on COMPEON. This is how the state banks NRW.Bank, L-Bank and Investitionsbank Schleswig-Holstein represent funding providers that provide entrepreneurs with direct opportunities for action, even with smaller credit lines. A special advantage of COMPEON: The cooperation with the German guarantee banks offers companies in the crisis even more options to get liquid funds into their own company at short notice.
"We stand with our partners enterprises now particularly to the side. In the current situation, it is more important than ever to deal with securing your own liquidity in a timely manner."
Nico Peters, Managing Director of COMPEON
COMPEON works specifically with the NRW.BANK and KfW to keep companies solvent even in times of crisis like these and to survive the situation surrounding the Corona virus in the best possible way.
Companies should now look to expand their own network as quickly as possible and strategically position advance financing for planned investments instead of postponing them until the second half of the year. Active action is required, rather than just reactively trying to cushion the consequences of missing orders, purchase orders or the like.
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