Banks required to grant
zero-interest loans until May

Customers to use proceeds for

salaries, operations, and debt payment

Banks and financial institutions have been required to provide exceptional loans in liras or US dollars to customers at zero-percent interest rate and free from commission.

The Central Bank (BDL) issued a circular a circular regulating the measure.

Link for the circular

Customers must use the loans’ proceeds exclusively during the period from March 2020 to May 2020 to settle maturing debts. Corporate borrowers will also be allowed to use the loans to pay salaries and finance their operations during the same period. The salaries will be paid directly by the bank or financial institution involved.

Banks and financial institutions must provide the new credit facilities to customers who had previously obtained loans from them including loans whose interests are subsidized by the State as well as loans that benefit from a reduction in the minimum reserves requirements of banks. These include housing, microcredit, and other facilities.

The new loans, which will be settled over five years, must be granted regardless of the existing credit ceiling of each customer.

BDL said that it will offer banks five-year credit facilities in dollars at zero-interest rate to the banks and financial institutions at an equivalent value to the loans they provide in liras and dollars.