The real impact of the COVID-19 crisis on trade is still unknown, but what is certain is that small and medium-sized companies will be the most affected. Given this, the SMEs receive emergency support for the coronavirus by the Government. Several banks also announced their own provisions. Learn more about these ads with Hispanic Entrepreneurs.
Business sector begins to feel the consequences
The expansion of the coronavirus has been rapid in Chile, therefore, it forced to take urgent measures to prevent its further spread. Given the need to implement social isolation to prevent contact between citizens, most of the commerce closed its doors temporarily.
For this reason, only those that are indispensable remain open. Among them supermarkets, pharmacies, basic service providers, among others. Reduction of operations, schedule adjustments, limitation on the products that can be purchased per person is part of what What companies do against coronavirus.
Many had to paralyze their production and sales, there are also those who have adjusted to change taking advantage of online commerce. Likewise, teleworking has been implemented in those sectors where it is possible to work from home.
All companies, large and small, have had to make quick decisions. Therefore, they are now required to review their plans to make adjustments that allow them to recover on leaving of the emergency. And their priorities will also change in the coming months.
Entrepreneurs are asking a lot of questions right now. How are they going to meet their commitments? What will happen to the debts? How to face the payment of credits and taxes? Can they survive with reduced or paralyzed operations? Where will they get the liquidity they need?
But neither the government nor the banks are oblivious to the concerns of businessmen and merchants. For this reason, they have announced a series of measures that will help them face the emergency.
SMEs receive support for coronavirus emergency
The Government, considering the effect of the spread of the coronavirus in Chile, announced a Economic Emergency Plan including:
- The Provisional Monthly Payments (PPM) of income tax are suspended for three months. This will allow to give liquidity to 700 thousand companies.
- Likewise, the payment of VAT will be postponed for companies with sales of less than 350 thousand UF. Thanks to this, 240 thousand companies will be able to make the payment in 6 or 12 installments without interest. This measure will last for three months.
- Around 500 SMEs with sales of up to 75 UF will receive an early refund of income tax. Which means that it will be brought forward for the month of April.
- The fourth measure of the Economic Emergency Plan has to do with income tax. In this sense, the payment of this tribute is postponed to next June, according to the statement they make in April.
- The companies that have sales below 350 thousand UF will pay the contributions for April along with the last three of the year, in addition, he stated that it will be with zero interest.
In addition to these, the plan includes other measures that seek to help the business sector. Thus, government purchases of less than 1.5 million pesos are included in the Agile Purchase.
Financing will also be granted through the State Bank, which will have 500 million dollars for it. It was also announced that utilities will pay debts to their cash providers.
Finally, we have another tax measure that Briones reported. It refers to the expenses related to the emergence of the coronavirus will be accepted as a tax expense.
Banks support SMEs
Various announcements have also been made from banks seeking to help small and medium-sized businesses. These include more flexible programs, loan refinancing and payment extensions.
The State Bank will continue to offer credit extensions with zero interest rate through the program We Are With You.
For its part, Banco de Chile will extend the mortgage and consumer loan installments. Other measures of this entity also include extraordinary loans for SMEs with sales of up to 100 UF per year.
Other entities that spoke out were Scotiabank and Banco Santander Chile. The first will refinance the loans, restructure the current debt and strengthen the Vamos Pyme program. While Banco Santander will offer personalized solutions to its clients.
This is how SMEs receive emergency support for the coronavirus. In this way, the aim is to help them to have greater liquidity to face the crisis and to recover faster.
