deferral of bank loans

27 March 2020

by Dries Torreele and Iris De Groote

Deferral of bank loans

The coronavirus crisis is having a huge impact on the cash position of our companies. The tax authorities have already partly responded to this by granting deferrals of payment, either automatically or on request. Nevertheless, entrepreneurs are still confronted with cash flow problems, for instance loans that have to be repaid. The Minister of Finance has now drawn up an agreement with the financial sector in order to address these problems.

Deferral of bank loans and guarantee scheme

6 months deferral of payment

Companies do not have to make capital repayments for a maximum period of six months. Interest, on the other hand, remains payable. After the deferral period has expired, payments will resume again. The term of the credit is extended by the period of the deferral.

In orde to draw upon this, companies must meet the following conditions:

  • There are payment problems as a result of the corona crisis (e.g. turnover has fallen, temporary or full unemployment is invoked or the company has been compulsorily closed down, etc.).
  • The company is based in Belgium.
  • The company may not be in arrears on its current credits, taxes or social security contributions on 1 February 2020 or had less than 30 days in arrears on these debts on 29 February 2020.
  • The company has met its contractual credit obligations with all banks during the last 12 months preceding 31 January 2020 and has no active credit restructuring.

The deferral can be requested from the financial institution for the following credits:

  • Credits with a fixed repayment plan
  • Cash credits
  • Fixed advances

Leasing and factoring are not part of the agreement concluded between the government and the banking sector. If payment problems  should arise, a bilateral solution should be sought.

Applications made up before 30 April are limited to 31 October. Applications made after 30 April will also lead to a postponement until 31 October. 

Companies experiencing problems will have to contact their financial institution and have to be able to demonstrate the impact of the crisis on their liquidity.

Do you need support with your cash planning and credit file? Contact your account manager or one of our specialists via corona@vdl.be.