Background information

Providing financial support to medium-sized and large companies for investments and working capital. Improved conditions for receiving loans are based on the European Union's 'Temporary Framework for State aid measures' to support the economy in the current COVID-19 outbreak. Also, this measure is part of the support package to stabilise the German economy and help out firms during the COVID-19 crisis. The package was adopted by the Federal Government at the end of March 2020.

Content of measure

If medium-sized or large companies seek syndicate financing for their investments or working capital, KfW bank will bear up to 80% of the risk, but no more than 50% of the total debt. The risk share amounts to at least €25 million. However, it is limited to a certain extent, i.e. 25% of the annual turnover in 2019 or double the wage costs in 2019 or it is not higher than the financing requirements for the next 12 months. This measure is part of the support package to stabilise the German economy and help out firms during the COVID-19 crisis. The package was adopted by the Federal Government at the end of March 2020 and includes several measures easing access to loans and financial assistance for companies of different sizes.

Use of measure

As of 11 August 2020, the KfW received 81,359 loan applications (for all its programmes). 99.8% of these applications were not higher than €3 million. Overall, 99.7% of all applications have been processed. The KfW has granted a total sum of €42.6 billion.

According to the KfW press release from 6 November 2020, the bank received 95,000 applications for all its additional COVID-19 related programmes, 99% of the application had been finalised by the bank. Around 97% of the applicants were small and medium-sized companies. Granted sums amounted to a volume of nearly €46 billion.

At the beginning of February 2021, the KfW had already announced that for it had granted €8.4 billion for syndicate financing in 2020.

In March 2021, the bank also stated that around €49 billion were spent in 2020 to provide financial assistance to companies suffering from the negative impact of lockdowns (figure refers to all pandemic related programmes under its umbrella).

The 2021 first quarter report from 17 May 2021 shows that KfW has provided €56 billion in funds related to COVID-19 special programmes such as this one.

On 11 August 2021, the KfW stated that the bank granted €58.6 billion in funds related to COVID-19 related special programmes between the beginning of the crisis and 31 July 2021. Compared to the previous-year period (€33.8 billion) the overall volume of aid programmes related to COVID-19 in the first half of 2021 has decreased to €6.5 billion. This decrease is attributed to the end of the lockdown and to the nationwide ease of restrictions in the second quarter of 2021. Mostly SMEs used the funds. In addition, the ZIA statistics show that €8.59 billion were granted for the syndicate financing programme as of 9 September 2021.

On 3 November 2021, the KfW stated that the demand for grants from COVID-19 related aid programmes continued to decrease. In the first three quarters of 2021, the bank provided grants worth €8.4 billion in this context.

On 11 May 2022, the KfW announced that demand for grants from COVID-19 related aid programmes kept decreasing. During the first three quarters of 2022, the bank provided €1.6 billion.

In its annual financial report for 2022, KfW announced that €22.4 billion had been drawn from the WSF as part of allocation transactions and an additional €12 billion for COVID-19 related assistance.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	SMEs Larger corporations	Does not apply to citizens

Actors and funding

Actors	Funding
National government Company / Companies	National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Consulted	Consulted
Form	Direct consultation outside a formal body	Direct consultation outside a formal body

Social partners' role in the implementation, monitoring and assessment phase:

• Unknown
• Main level of involvement: Peak or cross-sectoral level

Involvement

German social partners are usually consulted by the Federal Government on broader measures, though no formal tripartite social dialogue structure exists in Germany at the federal level.

Views and reactions

The Confederation of German Employers' Association (BDA) and the German Trade Union Confederation (DGB) jointly welcomed the crisis package adopted by the Federal Government in spring 2020. Social partners highlighted in the press release to be in support of the KfW administered measures targeting companies.

Sources

• 13 March 2020: DGB and BDA: The social partners share responsibility in the corona crisis over differencesSocial partners neglect differences (DGB und BDA: Die Sozialpartner stellen gemeinsame Verantwortung in der Coronakrise über Differenzen) (www.dgb.de)
• 07 April 2020: KfW coronavirus aid: loans for companies (www.kfw.de)
• 04 May 2020: Merkblatt Sonderprogramm "Direktbeteiligung für Konsortialfinanzierung" (www.kfw.de)
• 30 June 2020: 100 days of KfW Corona aid: tens of thousands of companies benefit from federal support in the fight against the consequences of the pandemic (100 Tage KfW-Corona-Hilfe: Zehntausende Unternehmen profitieren von Unterstützung des Bundes im Kampf gegen Folgen der Pandemie) (www.kfw.de)
• 11 August 2020: First half 2O20: KfW grants double (www.kfw.de)
• 06 November 2020: KfW special programmes prologned (www.kfw.de)
• 02 February 2021: KfW press release 2 Feb 2021 (www.kfw.de)
• 25 March 2021: KfW press release 25 March 2021 (www.kfw.de)
• 11 May 2021: Latest update on COVID-19 related loans (www.kfw.de)
• 17 May 2021: First quarter 2021 (www.kfw.de)
• 29 June 2021: ZIA statistics (zia-deutschland.de)
• 11 August 2021: KfW report first half of 2021 (www.kfw.de)
• 03 November 2021: KfW grants first three quarters 2021 (www.kfw.de)
• 01 February 2022: Information on syndicate financing (www.kfw.de)
• 10 August 2022: KfW press release August 2022 (www.kfw.de)
• 31 December 2022: KfW financial report 2022 (www.kfw.de)