Hong Kong government raises loan cap for SMEs, extends repayment period to help them cope with coronavirus crisis
- The maximum loan for SMEs has been doubled to 12 months of employee wages and rents
- The maximum repayment period of loans has been extended by two years
The Hong Kong government has once again come to the aid of the city’s small and medium-sized enterprises as the city struggles with its worst recession on record amid the coronavirus pandemic.
As part of enhancements to its financing guarantee programme for SMEs, the maximum amount of loans has been doubled for eligible firms and the repayment period extended by two years starting from Friday.
Under the SME Financing Guarantee Scheme, small businesses can now avail of loans amounting to employee salaries and rents for 12 months from the previous six months, or HK$5 million (US$645,160), whichever is lower, HKMC Insurance, a wholly owned subsidiary of the Hong Kong Mortgage Corporation said.
The scheme allows the Hong Kong government to provide financing guarantees for SMEs to get loans from banks
The maximum repayment period for loans under the scheme has been increased to five years from three, while the size of loan the guarantee commitment has been increased to HK$70 billion from HK$50 billion.