Colleagues look at charts on a computer screen


Tomorrow, the KfW Instant Loan will be launched, which constitutes another important component of the Federal Government’s comprehensive assistance package for small and medium-sized enterprises. After the programme was adopted on 6 April and approved by the European Commission on 11 April under EU state aid rules, the necessary steps were quickly taken for the KfW and the main banks to be able to implement the loan.

Federal Minister for Economic Affairs and Energy Peter Altmaier said: "We are now using the KfW Instant Loan to quickly provide our many mid-sized companies with the liquidity they so urgently need. By assuming 100% of the credit risk and with a loan term of ten years, we are providing reliable help, without undue bureaucracy. We have to make every necessary effort to support our SME sector so that our economy will be able to get back on its feet after the crisis. Mid-sized companies make up 99.5% of all companies in Germany, account for 60% of all jobs and 80% of all trainee positions.”

Federal Minister of Finance Mr Olaf Scholz said: “The Federal Government is doing everything it can to help our country make it through the coronavirus crisis successfully. We have set up an unprecedented aid package to ensure that small, medium-sized and large companies as well can survive this difficult time and then get back up to full speed. It is also critical that the assistance is disbursed very quickly. This is precisely what we are seeking to do through the KfW Instant Loan, which can be applied for from tomorrow (Wednesday). The Federal Government is covering 100% of these instant loans and the customers’ main banks do not bear any risk. This ensures that the money arrives quickly where it is most urgently needed.”

KfW Chief Executive Officer Dr Günther Bräunig said: “The KfW Instant Loan is another important measure in the coronavirus assistance package which is particularly tailored to companies and operations with ten employees or more. Because applications are submitted through the customers’ banks without any further risk assessment, assistance can reach the companies quickly, thus helping to mitigate the severe effects of the coronavirus pandemic.”

Key terms of the KfW Instant Loan for SMEs:

Provided that the company generated a profit on average from 2017–2019, or in 2019 if it has only existed on the market for a shorter period of time, an ‘instant loan’ is to be granted at the following basic conditions:

  • The loan is available to medium-sized enterprises with more than ten employees that have been active on the market since at least 1 January 2019.
  • The credit volume per company is up to 25% of total turnover in 2019, with a maximum of €800,000 being set for companies with more than 50 employees, and a maximum of €500,000 for companies with staff of up to 50.
  • The company is not allowed to have experienced financial difficulties before 31 December 2019 and is required to demonstrate that its financial position was sound at that point in time.
  • Upon request, there is a grace period of up to two years at the start in order to reduce the short-term burden.
  • The bank is released from 100% liability by KfW, hedged by a guarantee from the Federal Government.
  • The credit approval process does not involve additional credit risk assessment by the bank or KfW. There are no requirements for collateral security. This enables loans to be granted quickly.

Furthermore, improvements have been made to the already existing KfW Special Programme. These consist of an extension of the loan term from up to five to up to six years, and even for up to ten years for loans of up to €800,000. In addition, the fact that the company’s financial position was sound as of 31 December 2019 is used as basis for a positive business continuation forecast.

You can find further information here (in German).