Participatory loans

On the one hand, SMEs in need of equity, heckled by the successive waves of Covid-19, on the other, insurers and banks ready to invest, in the center: participatory loans.

It’s here 20 billion euro solution found by the Ministry of the Economy. This sum is distributed in the form of loans by the banks since early April.

Which companies are targeted?

SMEs with a turnover (turnover) in 2019 exceeding two million euros. They have until June 30, 2022 to seize this window of opportunity, or fifteen months to strengthen their balance sheet by contracting these loans.

The ideal candidates : SMEs which have a potential for a rebound, and in particular those which have not benefited from a loan guaranteed by the State (PGE).

Long-term financing guaranteed by the State

The loan term is eight years and repayment is due from the fifth year : enough time for SMEs to consolidate their cash flow before repaying.

The state brings a guarantee of 30% of the funds invested, hence the qualifier of “participatory loans with state support” (PPSE).

→ Bercy has also rolled out another option with “Relance Bonds”: reimbursement then takes place all at once at the end of eight years.

Immediate liquidity but a limited amount of borrowing

The loan is limited to 12.5% ​​of 2019 revenue. As regards the rates, they were set at 4% for SMEs and 5% for mid-size companies (ETI).

The device provides immediate cash, but we are far from the 0.25% rates granted to EMPs.

The goal is to allow companies battered by the health crisis to invest. This device would come, according to Bruno Lemaire, Minister of the Economy, in addition to other levers “which will make it possible to put money in the machine and accelerate the return to growth in France”.

The minister aimed in particular lower production taxes (20 billion euros planned by 2022), as well as equity investments via Bpifrance.

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