1. BorrowersPrivate sector business entities - companies, crafts businesses, sole traders, family farms, cooperatives and institutions that are young entrepreneurs, start-ups or female entrepreneurs* For the purpose of recovery from the consequences of earthquake and for stimulating the economic development of Sisak-Moslavina County – private sector business entities that operate or will operate in Sisak-Moslavina County**
*Criteria for defining youth, female and start-up entrepreneurship are available in the General Eligibility Criteria, which are a constituent part of this loan programme.
**HBOR may also consider loan applications for recovery from the consequences of earthquake of private sector business entities that operate in Zagreb and Karlovac counties.
2. Purpose of Loans
- Investments in fixed assets (tangible and intangible assets) for the purpose of business start-up, business modernisation, introduction of new technologies, increase in capacities, including tourism capacities, development and introduction of new products and services, promotion of new employment, etc.
- Working capital: up to 30% of the contracted loan amount.
3. Manner of Implementation
- In cooperation with commercial banks via commercial banks or through risk-sharing model – application and related documentation shall be submitted to the commercial bank by the borrower
- Direct lending to borrowers (except family farms that are not within the VAT system and associations) – application and related documentation shall be submitted to HBOR by the borrower
4. Loan Amount
- Generally, loans in the amount lower than EUR 50,000 are not approved
- Maximum loan amount is EUR 300,000 and depends on the specific features and creditworthiness of the borrower as well as the purpose and structure of investment. Financing through loan can be up to 85% of the estimated investment value, VAT not included*.
- Depending on the specific features and creditworthiness of the borrower as well as the purpose and structure of investment, it is possible to finance up to 100% of the estimated investment value, VAT not included, in case of loans in the amount of up to EUR 100,000.
- Loans for the purpose of recovery from the consequences of earthquake and for stimulating the economic development of Sisak-Moslavina County:
- Minimum loan amount is EUR 30,000.00
- maximum loan amount can be up to 100% of estimated investment value, VAT included (except for loans with interest subsidy under the NRRP** funds), provided that financing of VAT for the borrowers that operate within the VAT system is possible (except for loans with interest subsidy under the NRRP** funds) only through the award of de minimis In such a case, VAT has to be allocated to working capital in the breakdown of investment contained in the loan application.
**NRRP – National Recovery and Resilience Plan
5. Loan Currency
6. Interest Rate
|Interest rate||Possibilities of reduction||Criteria|
4% p.a., fixed
|- 0.2 percentage points||for youth employment|
|up to - 2 percentage points||with subsidy granted by County/City/Municipality|
2% p.a., fixed
for business entities investing in recovery from the consequences of earthquake and stimulating the economic development of Sisak-Moslavina County
|- 0.2 percentage points||for youth employment|
- In certain cases, interest rate can be even higher as follows:
- for borrowers that perform business activity and cannot obtain state aid and/or de minims aid, effective interest rate (EIR)* cannot be lower than the reference interest rate for a single borrower (RIR), all in accordance with the regulations on the award of state aid
- for borrowers with loans in the amount of EUR 5 million and above, HBOR determines the level of interest rate for each individual loan
**Reference interest rate (RIR) is the base rate (calculated and published by the European Commission), increased by a certain number of basis points (margin) that depend on the client’s rating (credit rating) and the assessment of collaterals, in accordance with the Communication from the Commission on the revision of the method of determining reference and discount rates (OJ C 14, 19.1.2008). It is applied for the calculation of aid in loans approved with promotional interest rates. The range of valid RIR is available in the Information on Base and Discount Rates and Reference Rates.
For borrowers and loans that meet the conditions prescribed by the Operational Programmes for the Implementation of Financial Instruments under the NRRP*, and part of the regular interest rate is subsidised by HBOR, in its own name and for the account of the Republic of Croatia, as follows:
7. Interest rate for loans with subsidy under the NRRP* funds
- For investments in green and/or digital transition: up to 75% of the regular interest rate, and a maximum of 3.00 p.p.
- For investments in special areas of the Republic of Croatia and/or RDI (research, development and innovation): up to 65% of the regular interest rate, and a maximum of 3.00 p.p.
- For other investments in competitiveness and resilience: up to 50% of the regular interest rate, and a maximum of 3.00 p.p.
- In case of lending in cooperation with commercial banks, interest rate is determined by the commercial bank in accordance with its internal documents
- In case of direct lending:
- in the amount of interest rate for loans in the amount of up to EUR 5 million in accordance with item 6. of the Programme or in the amount of specially determined interest rate for loans in the amount of EUR 5 million or above, or
- in the amount of reference interest rate (RIR)6 for a single borrower, if higher than the interest rate stated in the previous paragraph.
- EUR 500,000.00 for micro, small and medium-sized enterprises
- EUR 1,000,000.00 for mid-caps and large entities
- Variable, in accordance with the Ordinance on Fees for HBOR Services valid on the day of calculation:
- Loan application fee: 0.50% on the contracted loan amount
- Commitment fee: 0.25% on the contracted undisbursed loan amount
- For loans aimed at recovery from the consequences of earthquake and stimulating the economic development of Sisak-Moslavina County:
- No loan application fee charged
- No commitment fee charged
- No fee charged for changing loan terms and conditions
9. Period and Manner of Loan Disbursement
- Generally, disbursement period is up to 12 months, and depending on the purpose and the dynamics of investment, it is also possible to approve a longer period of loan disbursement
- Part of the loan intended for the financing of fixed assets is disbursed to the account of seller/supplier/contractor based on the documentation for utilisation of loan for earmarked purposes
- Part of the loan intended for the financing of working capital can be disbursed to the account of the borrower, with obligatory justification by documentation evidencing the use of loan for earmarked purposes
- For loans aimed at recovery from the consequences of earthquake and stimulating the economic development of Sisak-Moslavina County: refund of borrower’s investment that took place after the earthquake until the submission of loan application is permitted (for such a refund, commercial banks are not obliged to submit a prior notice to HBOR)
10. Repayment Period
- Up to 12 years, with up to 3-year grace period included, depending on the purpose and structure of investment
- For the planting and/or restructuring of perennial crops in agriculture: up to 14 years, including grace period of up to 5 years
- For investments in tourism or if the investment study indicates the need for longer maturity and/or grace period: up to 14 years, including grace period of up to 4 years
Generally, in equal monthly, three-monthly or semi-annual instalments
11. Manner of Repaymentepayment
- Lending in cooperation with commercial banks: collateral is determined by the commercial bank
- Risk sharing model: collateral is determined by the commercial bank and HBOR
- Direct lending: HBOR agrees the collateral with the borrower in accordance with HBOR’s internal documents (e.g. bills of exchange, debentures, pledge of property with insurance policy for the property endorsed in favour of HBOR, pledge of business shares, bank guarantees, guarantees of HAMAG-BICRO and other security instruments customary in banking operations), and the risk assessment of the investment and the borrower.
13. Related Documentation / Schedules
- General Eligibility Criteria
- List of Documentation and Commercial banks
- Decision on General Terms and Conditions of Lending Activities of HBOR
- Information on Base and Discount Rates and Reference Rates
- Operational Programme for the Implementation of the Financial Instrument of Interest Subsidy Fund for Loans to Micro, Small and Medium-Sized Enterprises under the NRRP
- Operational Programme for the Implementation of the Financial Instrument of Interest Subsidy Fund for Loans to Mid-Caps and Large Enterprises under the NRRP