Ukraine Expands Business Support with Subsidized Loans, War Risk Insurance

The Cabinet of Ministers has expanded state financial support for large-scale projects across critical sectors by introducing a new preferential lending mechanism and expanding war risk insurance compensations, Prime Minister Serhii Koretskyi announced on Sept. 17.Under the new initiative, the government will subsidize 5.5 percentage points of a bank’s base interest rate for loans of up to Hr. 1 billion ($22.4 million) per corporate group. The funds can be directed toward restoring fuel and warehouse infrastructure, modernizing processing plants, and providing working capital for wholesale and retail trade.JOIN US ON TELEGRAMFollow our coverage of the war on the @Kyivpost_official.In addition to business-to-business loans support, the government has expanded its existing war risk insurance program for businesses and simplified compensation procedures, the government website says. Under the updated terms, Kyiv and the Kyiv region have been added to the list of high-risk territories eligible for coverage, the prime minister wrote in his social media post.The range of insurable assets has also been broadened to include fuel, fuel transportation vehicles, agricultural machinery, trucks, and trailers, the government website says. To further ease the burden on enterprise owners, the maximum annual compensation for insurance premiums per business has been raised from Hr. 3 million ($67,200) to Hr. 5 million ($112,000), with coverage extended to leased property. Other Topics of Interest EU Allocates €100B for Ukraine in 2028-34 Budget Plan The allocation has drawn minimal discussion among EU member states so far, which is believed to be a positive sign. “Russia deliberately attacks civilian enterprises, warehouses and logistics facilities daily. Business suffers significant losses and needs support for rapid recovery. Our task is to minimize the consequences of Russian attacks for Ukrainian business and provide entrepreneurs with additional tools for recovery,” the post quoted Koretskyi as saying, noting that while an independent war risk insurance allocation is planned in next year’s budget, immediate relief was necessary today.National Bank of Ukraine (NBU) Governor Andriy Pyshny welcomed the expanded credit initiative during a press briefing, noting that central bank experts actively participated in drafting the framework. Pyshny expressed confidence that Ukraine’s banking sector possesses sufficient capacity to fulfill lending requests.Addressing broader economic support mechanisms, Pyshny acknowledged ongoing state arrears to commercial banks under the existing “5-7-9%” preferential loan program – a recurring issue spanning several years. He confirmed that the NBU, the National Bank Association of Ukraine, and the finance and economy ministries, are working to optimize repayment schedules while ensuring overall financial stability.The share of loans issued under the subsidized 5-7-9% lending program was rising again after a prolonged decline, Kyiv Post wrote in June. Back then, the NBU estimated the government’s outstanding debt to banks under the program to reach roughly Hr.10 billion ($223 million) by the end of the year, up from about Hr. 8 billion ($178 million) in 2025.NBU’s Director of Financial Stability Department Pervin Dadashova said that growth was driven by continued refinancing of working capital in sectors with limited immediate financing needs and by an expanded list of “resilience territories” eligible for softer terms, including newly added areas in the Odesa region.