Moratorium on loan repayments

Harris Kyriakides | View firm profile

As the second phase of the pandemic started to affect our country and the implementation of additional measures by the Cypriot Government to end it, the need for a new moratorium to protect certain categories of debtors arose. On 15/01/2021, the new decree imposing a suspension on loan repayments was published which provides the following:

(1)       Suspension of loan repayments for six (6) months, hence until 30 June 2021.

(2)      Any applications must be submitted by and no later than 31 January 2021 and will either be approved or rejected by the relevant credit institution by and no later than 28 February 2021.

(3)      The new decree for the suspension of loan repayments does not cover credit facilities which (i) have been entered into after 30 March 2020; or (ii) are in default for a period exceeding 30 days from 31 December 2020; or (iii) have already benefited from the nine (9) month loan repayment suspension implemented in accordance with the first decree of 2020 for the suspension of loan repayments.

The categories of debtors that fall within the moratorium are:

(i)            Credit facilities, irrespective of the purpose, granted to individuals or small– to medium–sized enterprises that are secured by a mortgage over a primary residence which does not exceed €350.000.

(ii)           Business purpose credit facilities to companies and self-employed individuals, whose businesses have been mandatorily suspended pursuant to the decree of the Ministry of Health dated 8 January 2021.

(iii)          Business purpose credit facilities to companies within the hotel industry.

(iv)         Credit facilities falling within any one of the above categories, the beneficiaries of which have submitted an interest on the basis of the first decree of 2020 for the suspension of loan repayments and their application has been approved by the relevant credit institution, yet the nine (9) month period has not elapsed since the start of the suspension. The debtors who fall within this category, will be in a position to apply for a suspension of loan repayment and the interest rate for a total period of nine (9) months.

The implementation of the new moratorium is intended to temporarily protect targeted categories of debtors, whose enterprises has been directly affected through the imposition of new measures to stop the pandemic, as well as to reduce the new wave of non-perforiming credit facilities that is expected to be observed in the near future due to detrimental consequences the pandemic has and will cause on the domestic and global economy.

For more information please visit our website microsite on Banking & Finance or email Mrs. Georgia Karamalli at

More from Harris Kyriakides