AMCM: Banks to show flexibility on SME loan repayments

The Monetary Authority of Macau (AMCM) has confirmed that local banks will not demand the immediate repayment of principal loans issued under Covid-19 relief measures to small and medium-sized enterprises (SMEs).

The reassurance follows concerns from some SMEs that banks had started requesting lump-sum repayments of deferred principals, sparking fears of financial strain.

During the pandemic, banks introduced government-backed relief arrangements that allowed interest-only repayments while deferring the loan principal. The four-year program ended in late 2024.

In response to the recent complaints, AMCM stated it had consulted with banks, which agreed to adopt a collaborative approach in dealing with repayment issues – even if borrowers had breached terms.

“Banks will seek mutually acceptable solutions and will not demand immediate lump-sum repayments,” the AMCM said, as cited in a TDM report.

The SME sector continues to face post-pandemic headwinds, including sluggish consumer spending. To ease pressure, the government has launched initiatives to boost domestic demand and rolled out a new Interest Rate Subsidy Scheme earlier this year.

The scheme offers eligible SMEs up to 4% in annual interest subsidies on loans of up to MOP5 million, repayable over three years. lv