Nearly half of the budget of the most ambitious plan to date for the funding of small businesses is at risk of going to waste, as about 60 percent of eligible small and medium-sized enterprises have not collected the subsidies and implemented their investments.
Of the 900-million-euro budget, approved as public expenditure, at least 400 million euros is now expected to remain unclaimed, with many eligible recipients – who total 13,500 – appearing reluctant or unable to go ahead with the investment for which they applied for a subsidy and received an approval.
Data show that so far no more than 100 million euros out of the 900 million has been disbursed to 2,750 enterprises in the form of deposits, with estimates suggesting that the program will not absorb any more than 450 million euros.
Business associations and chambers argue that problem lies in the first stage of the investment – i.e. the demand for a deposit – where candidates must submit a letter of guarantee equal to the deposit. They add that banks demand physical collateral for the issue of a letter of guarantee, which in most cases is impossible due to the devaluation of properties. Banks are also reluctant to help enterprises in the Tiresias credit profile database’s bad loans list.