State-owned asset management company (Kedipes) announced this week that it has officially terminated its interest subsidy scheme for performing credit facilities indexed to the European Central Bank’s main refinancing rate, effective from July 1, 2025.

The decision was taken by Kedipes’ board of directors, marking the end of a support plan that had been in place since 2023 to ease the burden on borrowers during a period of high interest rates and inflation.

In its announcement, Kedipes stated that approximately 3,200 loan accounts benefited from the subsidy scheme.

The total amount of interest subsidies provided by Kedipes for 2023, 2024 and the first half of 2025 reached €28.3 million.

The scheme offered subsidised interest rates of 3.5 per cent for housing loans and 4 per cent for credit facilities issued for other purposes.

Kedipes said the plan had been designed to provide meaningful relief to up-to-date borrowers facing economic pressure during a particularly challenging period marked by soaring borrowing costs.

The scheme was available to borrowers who were fully compliant with their loan repayment obligations and was intended as a temporary measure to help maintain financial stability.

Kedipes added that the decision to discontinue the scheme was based on a broader trend of declining borrowing costs, supported by the European Central Bank’s ongoing cycle of interest rate reductions.

The company stated that “the decision to end the interest subsidy scheme was taken in the context of the broader decline in lending rates and high inflation, as recorded gradually through the successive reductions in the ECB’s key interest rates.”

Alongside the termination of the scheme, Kedipes announced a new plan offering borrowers the opportunity to fully repay their outstanding loans with a discount on the remaining balance.

The company said more information is available at its district service centres in all cities.

Finally, Kedipes explained that this new scheme aims to accelerate the deleveraging of its loan portfolio and is fully aligned with its overall business strategy.