Impact of the Funding for Growth Scheme on the Hungarian economy

András László ()
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András László: MA student at the Corvinus University of Budapest

Financial and Economic Review, 2016, vol. 15, issue 4, 65–87

Abstract: In this paper, I examine the efficiency of the Funding for Growth Scheme (hereinafter FGS or Scheme), based on the loans disbursed until the end of 2015. The FGS is an unconventional instrument of the Magyar Nemzeti Bank, launched in 2013, the purpose of which is to provide micro, small- and medium-sized enterprises (SME) sector with loans on favourable terms. The efficiency of the Scheme means, on the one hand, to what extent the problem addressed by the Scheme was relevant, and on the other hand, the type of solution provided by it, and whether it did not involve excessive cost and risk compared to the anticipated results. I regard these as the two main pillars based on which its efficiency can be judged. I also present the Scheme’s descriptive data and practical implementation. According to the conclusions, the Scheme offered an adequate solution for a problem of national economy significance, it has set lending to SMEs on a growth path and also contributed to economic growth, with relatively low costs and risks compared to the achievements.

Keywords: Funding for Growth Scheme; unconventional monetary policy; credit crunch (search for similar items in EconPapers)
JEL-codes: E43 E50 E52 E59 (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:mnb:finrev:v:15:y:2016:i:4:p:65-87

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