On 16 March 2020 the Polish Bank Association (ZBP) published astatement on helpful actions to be undertaken by Polish banks in connection with the COVID-19 pandemic. The statement clearly shows that banks recognise the need to take urgent action in response to anticipated difficulties borrowers will have in performing their obligations. Banks are also assuring customers that such actions will involve introduction of simplified, less formal procedures for assisting borrowers finding themselves in financial difficulty due to the coronavirus pandemic.

The assistance proposed by Polish banks includes:

• Suspension of payment of credit instalments (for business and individual customers) for up to three months and automatic extension by the same period of the total credit repayment period (on condition that the credit repayment security is also extended). In this respect, banks will not charge fees or commissions on applications for suspension of credit repayment instalments, and will allow such applications to be filed in aless formal procedure, including remotely, even if this option was not included in the customer’s agreement with the bank.
• Renewal of financing for aperiod of up to six months for businesses that had credit capacity at the end of 2019 but were affected by the consequences of the coronavirus and have an approaching deadline for renewal of existing financing.
• Facilitating business customers’ access to short-term credit to stabilise the financial situation of bank customers affected by the COVID-19 pandemic. The details of this proposal are to be presented in the next few days.
  
  

Additionally, banks that have aleasing company or factoring company in their corporate group will take measures to postpone payment of leasing instalments or other payments from customers under rules comparable to those used in postponing repayment of credit.

The banks have also declared that they are involved in work which will soon raise the maximum amount of contactless payments to PLN 100. And in cooperation with the Cashless Poland Foundation, they are also taking steps to install tens of thousands more point-of-sale payment terminals.

The banks have also appealed to state authorities to take urgent actions to mitigate the economic consequences of the COVID-19 pandemic in Poland for businesses and to secure the stability of the financial system.

The specific actions taken by banks as part of the proposed assistance measures should be known within the upcoming days. We will attempt to address in an upcoming article questions on how the COVID-19 pandemic may impact existing credit agreements, whether borrowers can stop paying credit instalments, and whether banks can terminate credit agreements.

Source: www.inprinciple.pl