The President and the Prime Minister of Poland have announced a package of support measures for society and entrepreneurs called the Anti-Crisis Shield

By Slawomir Szepietowski

04-2020

The President and the Prime Minister of Poland have announced a package of support measures for society and entrepreneurs referred to as the Anti-Crisis Shield.

The Anti-Crisis Shield has five pillars:

  1. Employees

    In terms of support for employees, wage subsidies have been announced. People employed on commission and specific-task contracts, as well as self-employed people, are able to receive up to 80% of Poland’s minimum wage (currently PLN 2,600 before tax and social insurance contributions). If the criteria is met, the state budget will cover 40% of employees’ salaries up to the average salary in the economy, and the second 40% has to be covered by the employer. The employee has to agree to have their pay reduced by 20%.

    The Anti-Crisis Shield includes; an extension of the care allowance for children up to 8 years of age (currently 14 days) in the case of prolonged closure of schools, nurseries and kindergartens, the automatic extension of work permits for foreigners and, additional benefits for disabled people.

    The package also includes three-month credit payment vacations and postponement of payments for utilities (no systemic solutions).

  2. Companies liquidity credit

    The second pillar includes tax and social security contribution payments and extensions of de minimis guarantees of BGK for SMEs. Entrepreneurs will be able to receive loan guarantees, micro-loans up to PLN 5,000, and subsidies for interest on loans.

    Large companies are to receive financing from the Polish Development Fund in the form of temporary capital increase or bonds.

    The package also includes a possibility to settle 2020’s tax loss in full in the following year (without the 50% limit).

    Companies which are affected by a drop in revenue by 50% or more will be able to settle this year’s loss with CIT or PIT due for 2019 (up to PLN 5 million).

    The President of the Polish Social Security Administration (“ZUS”) has issued a special order:
    Under the order, “entrepreneurs” (also including self-employed individuals) who have found themselves in a difficult financial situation can submit a simplified application for deferring payment contributions for February, March, and April 2020 (the payment deadline expires on 10 or 15 March, April and May respectively) by three months.

  3. Healthcare

    The government intends to spend an additional PLN 7.5 billion on a healthcare. PLN 6 billion will be allocated to creating and equipping infection hospitals, medical transport and additional healthcare services. The government also plans to allocate the rest of the money for co-financing hospital infrastructure and digitalisation of healthcare.

  4. Financial sector

    The Anti-Crisis Shield includes a regulatory package which consists of abolishing the 3% systemic risk buffer for banks, the Polish Financial Supervision Authority (PFSA) allowing temporary non-compliance with capital and liquidity requirements, as well as making the rules of estimating losses in banks more flexible and shifting selected supervisory duties.

    The National Bank of Poland's lombard rate has been cut from 2.50% to 1.50%. The deposit rate has been left at 0.50%, and the rediscount rate was cut from 1.75% to 1.05%.

    The National Bank of Poland has conducted repo operations of PLN 7.5 billion as an extraordinary measure to improve liquidity in the bond market.

  5. Public investments

    The government will set up a new public investment fund worth at least PLN 30 billion independent from EU funds. It will be created to support infrastructural spending, energy transition, digitisation, environment protection and modernisation of schools.
Supervisory Impulses Package for Safety and Development

The PFSA has published the introduction of the “Supervisory Impulses Package for Safety and Development” in response to the pandemic outbreak and its impact on the Polish financial and banking sector.

To limit costs, the PFSA has adopted a flexible approach to applying the EBA guidelines on the management of non-performing and forborne exposures.

The PFSA is also ready to delay the implementation of its Recommendation R concerning the rules for identification of impaired balance-sheet credit exposures, calculation of impairment losses on balance-sheet credit exposures and provisions for off-balance-sheet credit exposures. This will allow banks to act with flexibility in determining the accounting principles, including the rules for estimating the provisions for the expected credit losses.

The limitation of costs also consists of proposed amendments to the Regulation of the Ministry of Finance on creating risk provision relating to bank activity, with the goal of extending the term of recognising credit’ collaterals (for the SME sector) in order to reduce the basis for the creation of specific reserves.

Measures by Polish banks to assist borrowers affected by COVID-19

The Polish Bank Association (ZBP) has published a bulletin on the measures agreed on by Polish banks to assist borrowers affected by the COVID-19 pandemic.

Pursuant to the above mentioned measures, banks will facilitate the suspension of principal and interest instalments or only the principal instalments of the loans for a period of up to three months, and automatic extension of the period of the loan repayment. These measures will relate to consumer loans for individual clients and loans for entrepreneurs, and will include a quick consideration of the applications of clients who justify the need to suspend their loans due to their financial situation caused by COVID-19.

Banks will also provide assistance to all entrepreneurs affected by the effects of COVID-19 which had creditworthiness at the end of 2019 and renewal of an existing financing is due in the coming months. Assistance will consist of renewing an existing financing for six months at the client’s request.

The measures also concerns granting customers payment holidays (grace periods) for leasing instalments and payables under leasing and factoring agreements.

In cooperation with the Cashless Poland Foundation, banks will take steps to install additional POS devices in places where payment transactions are carried out.

Banks have also taken part in works which allowed increases to the maximum amount of contactless payments to PLN 100.

Launch of devices with an increased limit on contactless payments without PIN

The largest operator of payment terminals in Poland, eService, has announced the launch of the first devices accepting contactless payments without PIN authorisation with a limit raised to PLN 100. Terminals are located in dozens of selected stores and will be launched in other commercial and service outlets. eService want to have tens of thousands of POSs with an updated limit.

Other payment terminal operators, such as Earlier, First Data, IT Card, PayTel and Polskie ePłatności, have also reported increased the use of devices with the updated system.

Last reviewed: 02 April 2020