Enacted law that extends the term of Pronampe lines to six years

Micro and small companies gained two more years to pay loans from the National Support Program for Micro and Small Businesses (Pronampe). President Luiz Inacio Lula da Silva sanctioned the Lei 14.554/2023which extends the repayment period of program loans from four to six years, created to help smaller businesses affected by the covid-19 pandemic.

The law also created a minimum grace period of 12 months. With the measure, the micro or small company has one year to pay the first installment of the loan. Maximum interest rates were maintained at 6% per month plus the Selic rate (basic interest rates for the economy).

The new conditions are not only valid for future loans. The law allows contracts signed from 2021 to be renegotiated by the new rules, but the process must follow conditions established by the federal government.

Updated every four months, the Companies Map, from the Ministry of Development, Industry, Commerce and Services, indicates that micro and small businesses, which earn up to R$ 4.8 million per year, represent 99% of the 20 million companies in the country. Smaller businesses account for 62% of jobs and 27% of Gross Domestic Product (GDP, sum of goods and services produced in the country).

Program

Created in 2020 as a relief measure during the pandemic, Pronampe allows micro and small businesses to borrow up to 30% of annual turnover. Resources can be used to purchase equipment and merchandise, renovations and operating expenses. The program prohibits the use of the credit line for profit sharing.

In addition to limited interest, Pronampe has a shorter contract period than traditional lines of credit for micro and small companies. This is because any defaults are covered by the Operations Guarantee Fund (FGO),

In 2022, a Lei 14.348 allowed the reuse of FGO resources in new guarantees until December 2024. The measure allowed Pronampe to lend more than R$ 50 billion in 2022 and 2023.