Interest-free loans for individuals

Banks offer interest-free loans to individuals

As the COVID-19 coronavirus spread in Bulgaria, the National Assembly declared a state of emergency by decision of 13 March 2020 and the Minister of Health issued Order No. RD-01-124 of 13 March 2020. Against this backdrop, 12 credit institutions expressed interest in joining the Bulgarian Development Bank’s guarantee programme for employees on unpaid leave and self-employed people. The programme provided for interest-free loans of up to BGN 4,500 for people unable to work because of the COVID-19 pandemic.

The commercial banks were:

• Allianz Bank Bulgaria
• DSK Bank
• Investbank
• International Asset Bank
• United Bulgarian Bank (UBB)
• Municipal Bank
• First Investment Bank
• Raiffeisenbank
• D Commerce Bank
• UniCredit Bulbank
• Central Cooperative Bank
• Eurobank Bulgaria

The Bulgarian Development Bank and the participating credit institutions were taking the legal and practical steps needed to agree and sign the financial agreements and make the necessary arrangements across the banks’ branch networks.

The procedure was expected to be accessible and streamlined so that the funds could reach affected individuals as quickly as possible.

The Council of Ministers approved the programme guaranteeing interest-free loans for people unable to work because of COVID-19 by Decision No. 257 of 14 April 2020. It formed part of the Bulgarian government’s emergency measures to protect the self-employed and employees during the state of emergency declared on 13 March 2020. They could receive up to BGN 4,500 either in one payment or in three instalments of BGN 1,500 each. Borrowers did not have to provide collateral or pay fees, commissions or contractual penalties. The maximum repayment term was five years, with a grace period of at least six and no more than 24 months.