Romanian Govt. taken by surprise by strong demand for working capital grants

Over 22,200 Romanian small and medium-sized enterprises submitted requests for working capital grants under the second measure of the EUR 1 billion program launched by the Government to support local entrepreneurs.

Local SMEs from sectors directly impacted by the COVID-19 pandemic can apply for grants of up to EUR 150,000 under this measure.

But the EUR 350 million budget (including EUR 42.5 mln co-financing from recipients and EUR 42.5 mln from the national budget with the rest coming from the EU budget) can cover only up to 5,000 requests, according to economy minister Virgil Popescu's estimates.

The Government could double the budget for this measure after prime minister Ludovic Orban suggested such a move and EU funds minister Marcel Bolos confirmed that some EUR 500 mln could be allotted, Startupcafe.ro reported.

Meanwhile, more than 40% of the budget allotted for the first measure, which consists of EUR 2,000 microgrants for SMEs with no employees and individual enterprises (PFA), remained unspent. Prime minister Orban announced a new round of financing for microenterprises to distribute the EUR 41.5 mln left after the first round.

The second round will also be open to SMEs with under EUR 5,000 in revenues but set up in 2019.

The entire EUR 1 bln program to help local entrepreneurs and SMEs that need working capital and investment grants is financed from the European Union's budget.

The third measure of this program consists of investment grants of EUR 50,000 to EUR 200,000. This measure hasn't been launched yet.

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