The BCRA established a mechanism to reduce reserve requirements.
Ignacio Petunchi
The directory of Central Bank (BCRA) This Thursday, it established an incentive system to encourage financing for MSMEs. Starting in April 2024, the Minimum MSME Quotaa simplified incentive scheme to encourage credit assistance based on the reduction in reserve requirements.
Specifically, financial institutions will only be able to benefit from reductions in their minimum cash requirements (reserves) linked to the proportion of loans to MSMEs to the extent that the average balance of these financings is at least 7.5% of its non-financial private sector deposits in pesos, and that at least 30% of said amount is allocated to investment projects with a minimum term 24 months of average life.
“The interest rates will be freely agreed between the parties,” details the BCRA in the statement. In addition, a new incentive is added to encourage longer-term loans. The financing to MSME investment projects that are granted for a term greater than or equal to 36 months of average life will allow the granting financial entity to additionally reduce 40% of the financing amount from its minimum cash requirement.
The BCRA maintains its commitment to continue with the normalization and flexibility process
regulatory response as macroeconomic conditions continue to stabilize. In that
In this sense, it is expected that normalization will allow the continued deactivation of subsidies that, through
Artificial incentives generate a quasi-fiscal cost to the BCRA that results in greater monetary issuance.
Source: Ambito
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