The era of cheap loans may end in Ukraine: the “5-7-9%” program is being prepared for changes

In Ukraine, the period of ultra-cheap lending for businesses is gradually coming to an end, and the state program “5-7-9%” may undergo a significant transformation. This is evidenced by signals from the government, the banking sector and financial experts, who increasingly speak of the rising cost of resources and the limited ability of the state to compensate for preferential rates.

Economists emphasize that the program worked effectively in conditions of a low discount rate and large-scale state support. However, the economic situation has changed now: the cost of financing is increasing, and the burden on the state budget is increasing due to the war and the need to finance the defense sector.

Against this background, the government is considering several options for reforming the program. Among the main scenarios is the transition to more targeted financing, which will be focused primarily on manufacturing enterprises, exporters and critically important sectors of the economy.

The possibility of reducing state compensation for interest rates is also being discussed. If such a decision is made, loans for businesses may become more expensive, and requirements for borrowers may become stricter.

Banks are already recording increased demand for loans under current conditions. Entrepreneurs are trying to arrange financing before a possible revision of the rules and an increase in rates.

At the same time, representatives of the financial sector warn: the increase in the cost of credit resources may negatively affect the investment activity of small and medium-sized businesses, which remains one of the key drivers of the country’s economic recovery.

Experts note that the future of the “5-7-9%” program will largely depend on the state of the state budget, the pace of economic recovery and the volume of international financial assistance, which partially covers the costs of preferential lending.