A Ukrainian bank has issued the first affordable loan under the concessional lending programme for defence manufacturers developed by the Ministry of Strategic Industries. The first loan of UAH 100 million at 5% interest for one year was granted to a manufacturer of electronic warfare and electronic signals intelligence equipment for working capital.

“The Government is constantly working to ease the conditions for Ukrainian arms manufacturers. It is important for us that companies have the resources to develop their production capabilities, upgrade equipment and improve products. The Affordable Loans programme, which was launched this year, has funding for the next year – UAH 500 million. We expect that these funds will contribute to the development of enterprises and, as a result, to a faster supply of weapons and equipment to the Defence Forces,” said Minister of Strategic Industries Herman Smetanin.

The soft loan programme was launched this year. Ukrainian defence manufacturers can receive up to UAH 100 million for working capital for up to 3 years or up to UAH 500 million for investment projects for up to 5 years. The interest rate for enterprises is 5%, with the rest of the interest paid by the state.

The purpose of the loan programme is to provide manufacturers with financial opportunities to scale up production, purchase equipment and individual machines and components, create new developments and launch them into mass production.

The only requirement to receive a loan is that the company must be identified by the Ministry of Strategic Industries as critical to the functioning of the economy during a special period in the defence sector.