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Coronavirus – Liquidity measures – Germany

  • Germany
  • Coronavirus
  • Coronavirus - Country overview


The protection shield

The German federal government has adopted a billion-euro protection shield for enterprises to avoid a liquidity shortage because of the COVID-19 pandemic. Enterprises shall be protected with new and unlimited liquidity measures.

1. Expansion of existing loan assistance schemes provided by the German development bank KfW

Existing liquidity support programmes will be expanded in order to facilitate access to attractive loans for investments and working capital.

Enterprises that have been on the market for more than five years: „KfW Unternehmerkredit“

  • For large enterprises (more than 250 employees, more than €50 million turnover or more than €43 million balance sheet total): up to 80% risk assumption (Risikoübernahme) (programme no. 037)
  • For small and medium-sized enterprises (about 250 employees and up to €50 million turnover): up to 90% risk assumption (Risikoübernahme) (programme no. 047)

Enterprises that have been on the market for less than five years: „ERP-Gründerkredit - Universell“

  • For large enterprises (more than 250 employees, more than €50 million turnover or more than €43 million balance sheet total) that have been on the market for more than three years: up to 80% risk assumption (Risikoübernahme) (programme no. 075)
  • For small and medium-sized enterprises (about 250 employees and up to €50 million turnover) that have been on the market for more than three years: up to 90% risk assumption (Risikoübernahme) (programme no. 076)

This shall also be applicable for enterprises that are less than 3 years on the market (large enterprises programme no. 073 and small and medium-sized enterprises programme no. 074).

Applications can be made at the enterprises’ relationship bank in an amount of up to €1 billion per group of companies.

The maximum loan amount is limited to:

  • 25% of the annual turnover in 2019, or
  • twice the wage costs of 2019, or
  • current financing needs for the next 18 months for small and medium-sized enterprises or 12 months for large enterprises, or
  • 50% of the total debt of the enterprise for loans over €25 million.

Reduced interest rates from 1.00 to 2.12 % p.a.

Term up to five years including one repayment grace year.

2. Additional KfW special programmes

Syndicate financing in an amount of at least €25 million (programme no. 855)

Participation in syndicated financings of investments and working capital (direct participation as syndicate partner or indirectly through risk sub-participations):

  • medium-sized and large enterprises
  • up to 80% risk assumption (Risikoübernahme) but not more than 50% of the risk of the total debt.

The KfW risk share amounts to at least €25 million and is limited to:

  • 25% of the annual turnover in 2019, or
  • twice the wage costs of 2019, or
  • the current financing needs for the next 12 months.

Optionally, all banks participating in the syndicate can be refinanced by KfW.


KfW fast-track loan for small and medium-sized enterprises: “KfW Schnellkredit 2020” (programme no. 078):

KfW has also introduced a fast-track loan for SMEs for investments and working capital, which differs from the above-mentioned KfW loan assistance schemes because the state/KfW bears 100% of the loan default risk which therefore significantly increases the chance of receiving a loan commitment. This is the Federal Government's response to criticism from the economy that the relationship banks are too cautious in granting loans because of the residual risk remaining with the relationship bank.

  • For self-employed workers and enterprises irrespective of the number of employees that have been in the market at least since January 2019
  • Maximum loan amount per group of companies: up to 25% of the turnover in 2019
    • enterprises with up to 10 employees receive a maximum of €300,000
    • enterprises with more than 10 and up to 50 employees receive a maximum of €500,000
    • enterprises with more than 50 employees receive a maximum of €800,000
  • Interest rate of currently 3.00 % p.a.
  • 10 years term including two repayment grace years
  • 100% risk assumption by KfW
  • No credit risk assessment, neither by the relationship bank nor by KfW
  • No granting of collateral
  • Restrictions on profit and dividend payments, compensation incl. gratification
  • The enterprise must have made a profit either in the sum of the years 2017-2019 or in the year 2019
  • Applicants must have their seat in Germany
  • The KfW fast-track loan can not be combined with other KfW loan programmes. It is also excluded to culminate the KfW fast-track loan with instruments provided by the economic stabilisation fund.

Please note that all applications for KfW loan assistance schemes need to be submitted via the enterprises' relationship bank which will then enter into a cooperation with KfW in this respect. Applications can be submitted, provided that the enterprise was not an “enterprise in difficulty” (as per EU definition) as at 31 December 2019.

KfW waives its own risk assessment for loan amounts of up to €3 million per enterprise, for loan amounts above €3 million up to and including €10 million per enterprise KfW conducts a simplified risk assessment. An exception is made for the KfW fast-track loan where no risk assessment is made, see above.

3. Guarantee schemes

Guarantees provided by the German guarantee banks (Bürgschaftsbanken)

The maximum guarantee amount will be doubled to €2.5 million. In order to accelerate the provision of liquidity, decisions on granting a guarantee up to an amount of €250,000 can be made by the guarantee banks independently and within 3 days.

Parallel federal-state guarantees provided by the large guarantee programme

This programme is a cooperation between the Federal Government, the State Development Banks (Landesförderbanken) and the guarantee banks and such measures are covered by the state aid regulations. Such programme has so far been limited to enterprises in economically underdeveloped regions and will now be available for enterprises outside these regions to cover working capital financings and investments with a guarantee requirement of minimum €50 million and with a guarantee cover of up to 80%.

4. Establishment of an economic stabilisation fund (WSF)

On 27 March 2020 the law on the establishment of an economic stabilisation fund (Wirtschaftsstabilisierungsfondsgesetz – “WStFG”) was adopted, which is to provide concrete support instruments for enterprises with liquidity bottlenecks. The fund is authorised to:

  • grant guarantees in a total amount of up to €400 billion in order to eliminate liquidity bottlenecks and support refinancing on the capital market. The term of the guarantees and the liabilities to be covered may not exceed 60 months.
  • participate in the recapitalization of enterprises by acquiring subordinated debt instruments, hybrid bonds, profit participation rights, silent partnerships, hybrid bonds or shares in the company and by taking over other components of the equity capital of these enterprises. Accordingly, the Ministry of Finance is authorized to take out loans of up to €100 billion for the WSF to cover expenses and measures.
  • grant loans to KfW to refinance the above-mentioned special programmes. For this purpose the Ministry of Finance is authorised to take out loans of up to €100 billion. The detailed conditions of the refinancing are to be determined on a case-by-case basis.

Access to the instruments should be granted to enterprises that meet at least two of the following criteria:

  • More than €43 million balance sheet total
  • More than €50 million turnover
  • More than 249 employees on a yearly average

Enterprises that do not meet the above-mentioned requirements but are active in sectors according to § 55 of the Foreign Trade and Payments Regulation (Außenwirtschaftsordnung) or are of comparable importance for security can also apply for guarantees. The WSF decides on these applications at its own discretion.

The law entered into force on 30 March 2020.

Please see for more information our legal briefing on the economic stabilisation fund.

Change of law: Law for the Mitigation of the consequences of the COVID-19 pandemic – Consumer loans

On Friday 27 March 2020, the law to mitigate the consequences of the COVID 19 pandemic in civil, insolvency and criminal procedure law was adopted.

With regard to consumer loan agreements entered into before 15 March 2020, claims for repayment, amortisation and interest which are due between 1 April and 30 June 2020 shall be deferred by 3 months from their respective due date if the borrower suffers a decline of income due to the extraordinary circumstances caused by the COVID-19 pandemic, making payments unbearable for the debtor, specifically in cases where the debtor’s means for living or the existence of business are endangered.

Further, creditors’ termination rights due to a payment default or a significant deterioration of the financial circumstances of the consumer or the value of a security provided for the loan are suspended until the expiry of the deferral period.

If the creditor and consumer cannot agree on an arrangement for the time period after 30 June 2020, the term of the loan will be prolongated by 3 months.

The above shall not apply if the creditor can claim that a deferred payment or the suspension of the termination right are unbearable for the creditor, taking into account all circumstances of the individual case.

These amendments entered into force on 1 April 2020.

Please note that these provisions are, other than as set out in the first draft of the amendment, only applicable to consumer loan agreements. However, the Federal Government may, in an accelerated procedure, extend the personal scope of the provision, in particular, to micro enterprises.