The Government relaxed dollar loans and expanded companies' access to financing

The Government of Javier Milei announced a flexibilization of the conditions for the granting of dollar loans to companies and confirmed that banks will be able to expand the universe of companies eligible for this type of financing.

The modification will allow financial entities to grant dollar loans to all companies, including those that do not generate income in that currency. The measure will be accompanied by a prudential regulation scheme that will establish limits for banks' exposure.

“Until now, banks with their dollar deposits could only lend dollars to companies that generated dollars or those that had guarantees from companies that generated dollars. Today we are extending that possibility to all companies, but within a macroprudential framework,” explained the Minister of Economy, Luis "Toto" Caputo, during the presentation.

The minister specified that financial entities will be able to allocate up to 15% of their dollar deposits to this type of loans. In addition, he announced changes in the minimum capital requirements and in the credit exposure limits of banks.

The Government seeks to boost credit for companies

According to the head of the Treasury, the objective of the measure is to increase the level of credit available to companies and to facilitate financing for productive sectors.

Among the activities mentioned by Caputo are construction and the automotive industry. In particular, he highlighted the impact that access to financing can have on the construction sector. “The construction industry is an industry that sells in dollars and generates a lot of employment,” he stated.

The minister also related the decision to the current scenario of interest rates in pesos. In this context, he suggested that a greater availability of dollar loans could create new financing alternatives for companies.

The formalization of savings

Caputo linked the flexibilization with the Fiscal Innocence regime promoted by the Government and with the intention of incentivizing the influx of dollars into the financial system.

“The goal is to have more credit, and for that, there must be savings. The savings are already there, and they are under people's mattresses,” he affirmed.

In that line, the minister stated that the official policy seeks to ensure that the dollars that remain outside the financial system can begin to generate returns by being incorporated into the banking circuit.

“On the other hand, we have the Fiscal Innocence law where we seek for people to start earning interest on those dollars they have had under the mattress for so long, which is not beneficial for anyone because people lose money keeping it there,” he indicated.

Caputo also suggested that greater competition among banks to attract dollar deposits could impact interest rates in pesos.

“Having a competitive rate in dollars in this currency competition can also lead to a decrease in the rate in pesos,” he noted. According to the official, this scenario will be favorable for small and medium-sized enterprises.

The flexibilization will not change a condition related to the currency operation of the loans. Caputo confirmed that the obligation to liquidate these loans through the Single and Free Exchange Market will remain in effect.

The decision seeks to prevent the new scheme from producing a multiplying effect on the demand for foreign currency and, at the same time, contribute to increasing the supply of dollars in the market.