Interest-free loans from the local budget

President Klaus Iohannis recently promulgated amendments to Law 273/2006 on local public finance, paving the way for more accessible financial support for grant-funded projects.

According to the new law, deliberative authorities can approve interest-free loans from the local budget for grant-funded projects, based on an agreement. This measure aims to ensure the efficient implementation of initiatives financed by non-reimbursable external funds, announces Presidential Administration. 

"This is an important step towards supporting projects with a positive impact on local communities. By introducing the possibility of interest-free loans for subordinate institutions as well, the aim is to increase flexibility and short-term support for projects with significant potential," explains the official source.

According to the new provisions, loans granted must be fully repaid within one year from the date of granting. There are, however, exceptions for projects with repayment terms linked to the repayment of final tranches from the funder. In these cases, the repayment deadline is 5 working days after receipt of the final installment.

These changes support local initiatives by providing more flexible financial support and encouraging the implementation of projects with a sustainable impact on communities. It is expected that this legislative development will facilitate access to resources for local projects and contribute to the sustainable development of communities.