National Response Guarantee Program

• With the increasing QMR lending rate and a shortened repayment period to only one (1) year due to an extended grace period of up to 36 months, the repayments of the NRGP facilities are resulting in a higher debt burden for clients, which could trigger higher cases of payment defaults.
• This NRGP Buy-out Program (“Program”) aims to allow clients to have better financing options (i.e., a lower profit rate and affordable repayment terms), which could lower, if not prevent, cases of default; and could allow the local companies to improve their cashflows and continue their business operations.

The new financing agreement or facility with QDB as a result of the Program shall have a maximum 5-year tenor, including a 1-year grace period with a 1% p.a. profit rate, and be governed as per QDB’s standard policy.

It is at the discretion of the PBs to offer the same financing terms as above, taking into consideration that the PBs role is vital to the economy, particularly in providing the best financing schemes for their clients. However, one of the main objectives of the PBs is to ensure profitability and sustainability for their stakeholders. In view of this, the Program’s financing terms may not be in line with that objective.

The Program shall be available to all NRGP clients with the PBs within a 4-month window effective from 10 October 2023 (“the Window”).

Yes. The PBs must accommodate all existing NRGP clients that have indicated their intention to transfer their outstanding NRGP principal balances within the window.

In the case of clients that opt out of being part of the Program due to various reasons, the relationship shall remain with the PBs, and their related guarantee cover under the NRGP shall remain valid until the duration of the NRGP guarantee period.

Note: NRGP coverage has only a 4-year guarantee period.

For accounts that are under litigation or have their cases filed in court for recovery purposes, PBs and clients have the option to cancel the related legal cases from the court and include the related accounts under the Program. In such cases, a proof of cancellation of the court case(s) must be submitted to QDB.

1. For blocked CRs

The PBs must process the accounts similarly to those with valid CRs; however, the PBs must require the clients to submit a document from the Ministry of Commerce and Industry (“MOCI”) explaining the nature or reason for the block.

2. For Invalid CRs

The current Obligor (i.e., one with a personal guarantee and is a signatory or applicant of the existing NRGP account) shall take over the facility as personal financing under the Program. In case the Obligor is over 63 years old, the Obligor must have a guarantor to provide 100% personal cheque and personal guarantee.

3. For CRs with sanctioned individual(s) among the company’s shareholders

The PBs must obtain approval from the Public Prosecution Office before processing their accounts and onboarding them for the Program.

A certificate of determination of heirs shall be presented to act accordingly, whereby the heirs will have the right to apply for a finance subject to taking and accepting the liabilities of the obligors and satisfying QDB’s conditions and requirements under the Program.