>> Download Newsletter SRB / ENG <<

On 17 December 2020 the National Assembly of the Republic of Serbia has adopted the Law on Determining the Guarantee Scheme as an Economic Support Measure for Mitigating the Consequences of the COVID-19 Pandemic Caused by SARS-CoV-2 Virus (the “Law”).

By this Law, the Republic of Serbia (“RoS”) undertakes the obligation as a guarantor of the banks to settle their claims arising from the credits approved by the banks in order to finance liquidity and working capital for crediting the economy.

Article 2 of this Law defines that the maximum credit amount, for which the RoS undertakes the obligation as a guarantor, is an amount equal to the lesser of the following two amounts:

  • a quarter, i.e. 25% of the income of the borrower from 2019 according to the financial statements of the borrower for that year, or
  • the amount of EUR 3 million for credits approved in euros, i.e. the amount equal to the dinar equivalent of the amount of EUR 3 million calculated at the middle exchange rate of the dinar against the euro, determined by the National Bank of Serbia (the “NBS”) valid on the day of concluding the credit contract, for credit approved in dinars.

The guarantee regulated by this Law will be issued with the following characteristics and in the following manner:

  • the guarantee will be issued in favour of the banks;
  • the guarantee will be issued as unconditional, without the right to object and chargeable upon the “first call”;
  • the maximum amount of the guarantee at the level of the secured portfolio is EUR 480 million;
  • an individual guarantee will be issued for the portfolio of each individual bank (the “Individual Guarantee”).

Individual Guarantee is defined by the Law as an agreement signed with each individual bank, and the moment of signing this agreement represents the moment of issuing the Individual Guarantee.

The Law also defines persons that cannot be beneficiaries of this aid. These are mainly persons who are in the status of non-payment of obligations in terms of NBS regulations, the persons who have overdue and unpaid tax obligations in the RoS, the persons against whom an appropriate restructuring measure has been taken in accordance with relevant RoS regulations, as well as the persons in whom the RoS and its organizational units have an ownership stake of more than 50%.

In accordance with the Law, the RoS can only guarantee for the credits approved by the banks for financing the liquidity and working capital, whereby the credits cannot be used to refinance and early repayment of the not matured instalments of existing credits in the bank’s portfolio, nor can be used to refinance the credits with other banks.

Additionally, credits repayment period that can be guaranteed in accordance with the guarantee scheme is up to 36 months starting from the date of the credit’s issuance, which includes a grace period from 9 to 12 months from the day of the releasing the credits.

However, in the credits repayment period is not calculated the application of the moratoriumintroduced by the decision of the NBS in order to mitigate the consequences of the COVID-19 pandemic in order to stabilize the financial system. For that matter, the credits repayment period will be extended for the duration of the said moratorium.

In accordance with this Law, the RoS, the NBS and the banks will conclude individual agreements on the guarantee of RoS, with the Government acting on behalf of the RoS. In addition, the Law explicitly stipulates that the NBS is not a guarantor, and that NBS cannot have any obligations based on the bank’s claims in accordance with this Law and individual guarantee agreements.

Finally, the Ministry of Finance will supervise the application of the Law’s provisions.


With the entry into force of the Law, the Decree on Establishing a Guarantee Scheme as an Economic Support Measure for Mitigating the Consequences of the COVID-19 Pandemic caused by the SARS-CoV-2 Virus (“Official Gazette of RoS”, nos. 57/20, 62/20 and 65/20) ceases to apply.

More on the conditions, procedure, amount and the manner of providing funds for the issuance of the guarantees of RoS in accordance with the guarantee scheme defined by this Law, you can find here.

This website uses cookies to improve your experience.

Read More Accept