Bank of Japan to introduce new system of support for small and medium-sized enterprises to begin extraordinary monetary policy meeting

Bank of Japan’s extraordinary monetary policy meeting begins at 9:16 a.m. on May 22 to introduce a new system for supporting small and medium-sized enterprises

The Bank of Japan has held an extraordinary monetary policy meeting from 1 a.m. on The 22th. We have decided to introduce a new system to support the tight financing of small and medium-sized enterprises affected by the new coronavirus.
The Bank of Japan’s meetings are held once a year, but it is unusual to hold temporary meetings.

At the meeting, the government decided to introduce a new system to increase real interest-free and unsecured loans by private financial institutions this month as a support measure for small and medium-sized enterprises that are becoming more financially funded by the government’s economic measures.

This is a mechanism that encourages private financial institutions that have implemented loans to actively finance by issuing funds at an interest rate of 0¢.

At a meeting held last month, the Bank of Japan decided to implement additional monetary easing to provide ample funds to the market by buying government bonds without a limit to support the rapidly deteriorating economy.

However, the economy is becoming more severe due to a series of corporate collapses caused by the new coronavirus, such as the application of the Civil Rehabilitation Act by apparel giant Renaun.

The government is working on a draft budget for the Second Amendment to implement additional economic measures, but the Bank of Japan is also expected to take steps and rush to provide support.