On Thursday, July 3, Cyprus-based collateral management company KEDIPES announced the end of its Interest Rate Subsidy Scheme for existing loans.
A total of 3,200 borrowers benefited from the program.
From July 1, 2025, the interest subsidy program for current credit lines whose base rate was linked to the European Central Bank's (ECB) main refinancing rate will cease to apply, KEDIPES announced.
KEDIPES launched the subsidy program in 2023 as a temporary anti-crisis measure amid rapid growth in interest rates and inflation. It offered reduced rates of 3.5% for housing loans and 4% for other types of loans.
The program was in effect until the end of the first half of 2025, with subsidies available only to borrowers in good standing with their payments. From 2023 to 2025, KEDIPES paid a total of €28.3 million in subsidies.
The subsidy program was an initiative designed to provide support amid sharply rising borrowing costs and high inflation, and played an important role in ensuring financial stability for thousands of conscientious borrowers, the company said.
In the context of ongoing economic stabilization and gradual reductions in key ECB interest rates, the decision was made to end the subsidy scheme. This was accompanied by a general de-escalation of borrowing costs in financial markets and easing inflationary pressures in the euro area.
Notably, in parallel with the termination of the subsidy program, KEDIPES is launching a new plan that allows borrowers to repay their loans early at a discounted rate.
The new program is aimed at encouraging voluntary reduction of the overall credit burden and accelerating the recovery of the company's loan portfolio, in full accordance with KEDIPES' business strategy, the company emphasized.
Interested borrowers can obtain detailed information about the new plan at KEDIPES regional service centers in cities throughout Cyprus.