The banking institution has had to reinvent its activities in order to provide a service to individuals and companies during this period of confinement.

The advent of coronavirus has completely disrupted social and economic life on a global scale, with our environment being the one to suffer the most damage from the pandemic. The central government decreed a state of alarm last March and as a result, citizens have found themselves trapped in their homes to prevent health services from collapsing due to the unexpected growth of patients infected with Covid-19.

Also, various sectors of the economy temporarily stopped their action, not so much those considered essential services, which continued with their action, although in many cases they took restrictive measures in terms of hours, number of employees, etc. Examples of this case are the banking institutions, which have continued to open their doors in the midst of this whirlwind, despite the fact that they have taken austerity measures.

Laboral Kutxa is an example of all this. First of all, the Basque entity has had to make a very important effort to adapt its central services, as it has had to send many employees to teleworkers. On the other hand, the offices have reduced their opening hours at the counter in front of customers so that managers have time to do their job because there were fewer employees at work. Therefore, in many cases they have taken turns working among themselves.
If there’s anything noticeable about Caja Laboral employees these days, it’s the tremendous growth in their online relationship with customers, as well as a huge demand for information and a lot of uncertainty.
It is reasonable that Caja Laboral has drawn up a package of measures and services aimed at families, individuals and companies so that they can face the coming crisis.

Unemployment benefit

Subscription is advanced. Caja Laboral also publishes a number of online bulletins on cybersecurity recommendations, health advice, healthy habits and leisure, among others.

Companies

With regard to aid for companies, the Basque Government has activated a special line with Elkargi, Laboral Kutxa and other financial institutions.

Beneficiaries:

• SMEs in the Basque Country.
• Individual entrepreneurs (micro-SMEs) and professionals from the Basque Country.

Loan amount

• € 5,000 -1,000,000 for SMEs.
• € 5,000-€ 100,000 for micro-SMEs and self-employed professionals.

Financial transactions:

• Instrument: repayable loan.
• Interest rates: 0%, subsidized by the Basque Government.
• Term of loan operations: 5 years (grace period optional)
• Settlement frequency: quarterly.
• Commissions: € 0.

Cost and conditions of guarantees (Elkargi):

• Formalization committee and examination committee: 0.25% of the guarantee formalized and in a single period.
• Guarantee commission: 0.375% per annum.

ICO line guarantee for liquidity

Caja Laboral has subscribed to the ICO Covid19 line, which has been approved with an endowment of 100 billion euros. The first part activated in the agreement has an amount of 20 billion euros, of which 50% will be reserved for self-employed and SMEs to guarantee loans.

Companies and the self-employed affected by the economic effects of COVID-19 may apply for these guarantees, provided that the applicants have not failed on 31 December 2019 and were not in bankruptcy proceedings on 17 March 2020. The guarantees will be retroactive and may be requested for operations formalized after the entry into force of Royal Decree-Law 8/2020, which took place on 18 March.

The guarantee will guarantee 80% of new loans and renewals requested by the self-employed and SMEs. For the rest of the companies, the guarantee will cover 70% of the new loan and 60% of the renewals.
The guarantee provided will be valid for the term of the loan granted, for a maximum of five years. The cost of the guarantee, between 20 and 120 basis points, will be borne by the financial institutions.

Interested companies and self-employed persons can apply for a guarantee for their operation until 30 September 2020.

Financial institutions are committed to maintaining the costs of new loans and renewals that take advantage of these guarantees in line with the costs applied before the start of the COVID-19 crisis.

Special lines:

LABORAL Kutxa's EIF-Social Line offers loans and credit accounts of up to 500,000 euros to social economy companies with bills of less than 30 million euros: cooperatives, labor companies, mutual societies, job placement companies, special employment centers, foundations and associations that can benefit from financing. LABORAL Kutxa has not asked the recipients for a mortgage guarantee and has promised to provide a subsidy of 50 million.

EIF-Micro line: Commercial loans for self-employed and legal entities. In all cases, the number of people hired by a self-employed company must be less than 10 and the annual turnover is less than € 2,000,000. The maximum amount per beneficiary is 25,000 euros.

Navarre

In Navarre, the support of Caja Laboral does not vary much. The Navarre Development Association (SODENA) has activated a special line with Elkargi, Sonagar, Laboral kutxa and other financial institutions. The purpose of this funding is defined in the same term: to cover 6-month structural expenses.