FinMin: Any increase in guarantee ceiling for IMM Invest must be approved by European Commission

Any increase in the guarantee ceiling for the IMM Invest programme (meant for SMEs) must be approved by the European Commission because this program is a state aid scheme, according to the Minister of Finance, Florin Citu.

Citu's reaction was triggered by the adoption on Wednesday by the plenum of the Chamber of Deputies of the Emergency Ordinance on IMM Invest, modifying the normative act so that, for 2020, the total ceiling of guarantees that can be granted under the programme was increased from 15 billion lei to 30 billion lei.

308 deputies voted "in favour" of this and there were two abstentions.

"Although it started only a few weeks ago, the IMM Invest programme is a success confirmed now by all political forces. PSD [the Social Democratic Party] tried to undermine this programme from day one, but in the face of real data, it had to surrender. Today, in Parliament, Ciolacu and his gang demanded the doubling of the guarantee ceiling for IMM Invest. By today's decision, PSD agrees with me. I have said countless times that if the programme is a success we will increase the guarantee ceiling. Mr. Ciolacu, I congratulate you for listening to me and for taking notes. I knew that even you would understand that everything I propose is fantastic. Of course, PSD makes this change in a populist style and without a substantiated analysis. I will make this analysis. The incompetents from PSD do not know that any increase in the ceiling must be approved by the EC on the basis of a very well-founded analysis. IMM Invest is a state aid scheme and must be approved by the EC. They will learn after reading this message," the Finance Minister wrote on his Facebook page.

More than 57,800 small and medium-sized enterprises are enrolled in the IMM Invest program, which totals about 726,200 jobs, with about 5,000 cases having been approved by the banks so far, said on Tuesday Dumitru Nancu, general manager of the National Loan Guarantee Fund for SMEs (FNGCIMM).

IMM Invest is the largest SME support programme in Romania created in the past 30 years. The main advantages brought by it are the following: the state insures up to 90 per cent of the loan amount, the interest on loans is fully subsidized by the state, at least until the end of the year, zero commissions related to the state guarantee, zero early repayment commission, and the period for which the warranty is granted is up to 72 months.

In the case of SMEs requesting loans/working capital line of credits, the financing can reach up to 5,000,000 lei, guaranteed up to 80 per cent in the case of medium-sized enterprises and up to 1,000,000 lei, with a guarantee of maximum 90 per cent, in the case of small and micro-enterprises. The duration of the financing for working capital is of maximum 36 months, with the possibility of extension for another 36 months, the interest rate being 3-month Robor + 2.5 per cent/year.

In the case of both types of loans, the interest, the costs of granting, monitoring and administering the guarantees granted in the name and account of the state will be borne from the state budget, until December 31, 2020, with the possibility of extension.