Azerbaijan allocates loans to cover debts of businesses suffering from Coronavirus

According to the decision of the Cabinet of Ministers of the Republic of Azerbaijan dated July 9, 2020, it is planned to provide a state guarantee for the return of up to 60 percent of the loan amount allocated to entrepreneurs by commercial banks in 2020-2021 within the framework of measures to provide financial support to business entities affected by the coronavirus pandemic. The Ministry of Finance has released information about this, Azernews reports.

It was reported that a total of 499.5 million manat loans were allocated to 2628 entrepreneurs, of which 291.6 million manats were provided with state guarantees. In the agreements signed by the Ministry of Finance with the Entrepreneurship Development Fund and the mentioned banks and entrepreneurs, the Ministry has been identified as the guarantor for providing the state guarantee for those loans.

Since the main debt obligation was not fulfilled on time from the time the state-guaranteed loans were allocated, the Ministry of Finance, as a guarantor to 7 banks, paid 658.2 thousand manats to 14 entrepreneurs in 2022, and in 2023, during the 12 months of the year, it paid 1,531.1 thousand manats of 27 entrepreneurs. Thus, during the two years of the program's validity, the overdue credit obligations of 41 entrepreneurs in the amount of 2 million, 189 thousand, 300 manats were covered by the state.

Following the conditions for issuing state guarantees, the Entrepreneurship Development Fund has the right to claim the loan debt paid to banks instead of business entities based on the state guarantee from those business entities.