Which companies will emerge victorious from the crisis?

The coronavirus crisis has put many companies in an extremely difficult financial situation. The key word is liquidity. No company will be left untouched by this crisis – the effects are either direct (forced leave, collapse of the market or distribution channel) or indirect (unpaid bills, reduced demand, etc.).

The crisis struck us all unexpectedly, no one is prepared. None of us knows how long it will last, how big its impact will be and how soon we will recover from it.

Every crisis acts in a sense as a market catalyst – the strongest survive and become even stronger; the weakest are destined to fail.

How to maintain liquidity

Yes, first of all it’s deep pockets that can make a difference. But few have them. Even the companies with the most conservative risk management do not keep several months worth of reserves in a bank account. In normal circumstances, this would just be a waste.

Second, a rapid response – the pace and aptness of the next steps. Now and immediately, you need to critically review your company and determine what is essential for long-term survival (products, activities, people, other resources). Efforts must be made to retain enough money for covering the essentials.

This means that a PLAN must be drawn up. Substantive, agile and feasible. Numeric. A swift and concrete action plan aimed at sustainability. With such a plan, it is possible to receive support from banks and the state.

How to apply for a Kredex guarantee?

The state has come up with labor market measures that provide the first small relief.

The volume of loansgranted by commercial banks to Estonian companies (at the end of February) is approximately 9.3 billion euros. The state has promised to come to the rescue and is increasing the limit of Kredex guarantees by one billion euros. In addition, Kredex has a resource of 500 million euros for granting working capital loans and 50 million euros for granting investment loans.

It is clear that these labor market measures and additional loan volumes are not enough. The money will go to those who have an adequate PLAN and for whom extra money will help to survive the crisis.

If your company has a good and functioning loan relationship with a bank, then the fastest and easiest way is definitely to apply for the necessary financing to survive the crisis from your home bank. If this is not the case, this relationship must be established. Alternatively, one can put their hopes on future Kredex measures.

We help to submit a loan plan to banks and Kredex

We, the Finsa team, are ready to come to your aid to OPERATIVELY help your company to think through the survival plan, write it down and put it in a form suitable for submission to banks and Kredex. We also help to communicate with banks and Kredex.

Call us today – let’s review your plan together and take steps to make your company stand out as the winner. Together we are faster and more effective.


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