ABSTRACT
Using a proprietary quarterly database of lending decisions (N = 3,687) from 31 March 2019 to 31 December 2020 for small- and medium-sized enterprises (SMEs), this chapter investigates how the financial measures introduced by Law Decree No. 18 of 17 March 2020 in terms of moratorium of interest could have effectively slacked liquidity shortfalls during the COVID-19 outbreak. Findings suggest that a public measure of assessment works better in the case of low risk and large firms as well as in the presence of personal guarantee and a strong relationship lending story.
