The Brazilian President Jair Bolsonaro signed on Monday the law that creates a special credit line for micro and small companies during the COVID-19 pandemic.
According to the new law, that it was changed by the Congressmen, the interest rates of this new line will be equivalent to the country’s benchmark interest rate (today at 3% per year) plus 1.25% per year. The rate approved by Congress prevailed over the original economic team suggestion of up to 8% per year.
The loans will be made with funds from financial institutions and will be guaranteed by the government, through the Operations Guarantee Fund (FGO), limited to 85% of the operation value.
Created to assist companies in the midst of the coronavirus pandemic, the National Support Program for Micro and Small Enterprises (Pronampe) authorizes loans for up to 30% of companies’ gross revenue in 2019.