Corona aid for companies: One in four has to pay back money

Corona aid for companies: One in four has to pay back money

According to a report by www.stuttgarter-nachrichten.de, companies that have used government Corona aid have now received a preliminary balance sheet. According to the Ministry of Economic Affairs, almost every fourth company has to repay part of the aid received. At the same time, however, around 40 percent of companies receive additional payments from the federal government. The Corona bridging aid was paid out unbureaucratically to companies whose existence was threatened and with large declines in sales, but the payment was linked to a final statement that compared the actual decline in sales and eligible fixed costs with the forecast. This interim balance is based on a sample of 338,000 applications submitted for the final accounts, with the deadline for the final accounts being extended to October 31st.

This development could impact the market and the financial industry in several ways. On the one hand, trust in government financial aid for companies could be weakened, which could lead to fewer companies taking advantage of it in the future. This, in turn, could affect the economic recovery after the pandemic.

On the other hand, the repayment or additional payment requirements could have an impact on the liquidity of the companies affected. Depending on the amount of repayments, this could lead to financial bottlenecks and endanger the financial stability of the company.

In addition, public debate about the effectiveness and fairness of government assistance programs in light of repayment requirements could increase, which could lead to policy and regulatory changes in the financial industry. It is therefore important to closely monitor this development and consider possible countermeasures in order to minimize the negative impact on the market and the financial industry.