On Wednesday 24 August, Santander Brazil commenced an emergency facility, the FGI PEAC (Fundo Garantidor para Investimentos do Programa Emergencial de Acesso a Crédito — Emergency Access to Credit Programme Investment Guarantee Fund), intended for individual microentrepreneurs and small- and medium-sized enterprises, via an initiative by BNDES (the Brazilian Development Bank). The resumption of the programme, which aims to stimulate lending through secured guarantees to financial institutions, gives businesses with a yearly turnover of up to R$300 million the green light to apply for a loan with Santander. This time around, the Bank plans to pay out R$1 billion in lending through the Brazilian Federal Government's programme.

The bank's corporate customers must apply for this facility exclusively through branches. The sums range from R$1000 to R$10 million, depending on the size of the business, which will be able to use this financial stimulus for rebalancing cash flow, for working capital or for carrying out investments in the business. Payment  terms range up to 60 months (five years) and the average rate could reach up to 1.75% per month.

According to Alexandre Fontenelle, executive superintendent of the Corporate segment at Santander Brazil, the BNDES emergency programme is very alluring for micro-, small- and medium-sized entrepreneurs, and it is also very beneficial to businesses in need of financial respite. The programme serves as a two-way street, since it's a way for banks with below-average default rates on this facility to increase their appetite for extending credit. 

"There is a very precise compromise to be had between product pricing and customer risk analysis, among other requirements guaranteeing the programme's sustainability", concludes Fontenelle.