Background information

On 19 January 2020, a description of the conditions for the implementation of the incentive financial instrument “Direct COVID-19 Loans” (the Description) was approved by Order No B-14 of the Director General of UAB Investicijų ir Verslo Garantijos (INVEGA), providing for the possibility for businesses affected by COVID-19 to apply for soft loans. These loans are designed to help businesses facing a shortage of working capital. The loans should help business to cover the costs incurred or anticipated during quarantine and thus to ensure business continuity.

Content of measure

The Description provides for loans to small- and medium-sized enterprises (SMEs) and large enterprises, except for businesses in the field of agriculture, forestry, fisheries, aquaculture and finance. The loan funds can be used to cover the expenses incurred (planned to be incurred) from 1 October 2020 to 30 October 2021. The loans are provided on preferential terms, i.e., at reduced interest rates which depend on the loan period and the status of the borrower. The highest interest rate can be up to 0.69% for SMEs and up to 1.69% for large enterprises. Only one loan may be granted to one business entity, which may not exceed the average monthly turnover and in any case may not exceed €100,000. Loans are granted for a maximum period of 72 months.

To be eligible for the loan, business entity should meet the criteria for assistance set by the Government of the Republic of Lithuania. One of such criteria is a drop in turnover of more than 30% during the period from 1 November 2020 to 31 January 2021, as compared to the monthly average turnover in the corresponding period in 2019-2020. In the case of new business entities, there must be restrictions imposed on their primary activities during the second quarantine.

Business entities seeking loans may submit applications to INVEGA from 20 January to 31 May 2021.

Use of measure

According to INVEGA, in total, €36 million has been allocated for the implementation of the measure from the state budget.

According to INVEGA, on 19 November 2021, there were a total of 1,621 applications filed for the total amount of €35 million, of which 875 applications have been approved, 725 rejected and 21 are being processed.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Applies to all businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government Social partners jointly Public support service providers	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:

• No involvement
• Main level of involvement: Peak or cross-sectoral level

Involvement

Social partners consulted only ad hoc, the tripartite meeting was not held.

Views and reactions

Information is not available.

Sources

• 19 January 2021: Description of the conditions for the implementation of the incentive financial instrument “Direct COVID-19 Loans" (Priemonės „Tiesioginės COVID-19 paskolos“ įgyvendinimo sąlygų aprašas) (invega.lt)
• 28 January 2021: Soft COVID-19 loans provided directly by INVEGA to finance operating costs (INVEGOS tiesiogiai teikiamos lengvatinės COVID-19 paskolos – apyvartinėms išlaidoms finansuoti) (www.vz.lt)
• 29 June 2021: Funds used by INVEGA (invega.lt)
• 26 July 2021: Description of implementing provisions for the measure "Direct COVID-19 loans for businesses" (invega.lt)
• 09 February 2022: Order No 4-208 of the Minister of Economy and Innovation of the Republic of Lithuania (e-seimas.lrs.lt)