On April 21 the House of Representatives received the Finance Minister, Alberto Carrasquilla, to hear his account of the actions taken by Finance in the context of the COVID-19 economic emergency. In other news, the Senate’s Third Committee held a meeting with the Banco de la República (BanRep, in Spanish) Manager on April 22 to discuss the measures taken by the bank during the emergency. Also, the Financial Regulation Unit (URF, in Spanish) published its regulatory agenda for the rest of 2020. Finally, Colombian President Iván Duque announced that he will extend social aid programs to contain the effects of COVID-19 until May 30.
The representatives used the opportunity to ask questions of the Finance Minister. Mauricio Toro and Katherine Miranda (Alianza Verde – opposition) questioned Carrasquilla about the obstacles Colombian companies face in accessing credit. “We notice that this money is not reaching them, we see a short circuit between the government, the banking sector and the National Guarantee Fund,” stated Toro.
The Minister responded that in mid-March, the Financial Superintendency had instructed banks to implement debt rescheduling programs without increasing interest rates and highlighted the drop in these interests as a result. He added that there are allocations to the Solidarity Income Program and that the National Guarantee Fund has been reinforced as steps to alleviate the crisis.
Regarding the Third Senate Committee meeting, where the BanRep gave a presentation, Bank Manager Echavarría explained that the entity’s goal is to guarantee the payment system’s proper functioning, ensure there is adequate credit supply for companies and contribute to market stability. He also highlighted the legal reserve reduction to ensure bank liquidity and lower interest rates to alleviate the debtor’s financial burden.
For its part, the URF published the update to its regulatory agenda for the rest of 2020 where the entity aims to expand its investment base, adopt international standards and promote digital transformation in the country. It plans to issue a decree regarding digital payments in the third quarter and one for open banking in the fourth quarter of 2020.
President Duque also stated today that he will continue to provide economic aid for the most vulnerable families until next month, adding that the National Government is seeking to “scale up each aid package” by increasing scope and frequency. He also said that they will continue to refund VAT to low-income families and will guarantee “Solidarity Income” Program transfers until May, with a view to considering a possible third transfer for June.