35. Poland

The COVID-19 pandemic has unleashed an unprecedented health and economic crisis. Nonetheless, the fall in national GDP has proved to be relatively small: -1.7% and -2.7% in the third and fourth quarters of 2020, compared to respective quarters in 2019. Moreover, Poland started 2021 on a strong economic footing, and it is expected that the negative impact of the pandemic on economic activity will be temporary. Overall, real GDP growth is projected to reach 4.8% in 2021 and 5.2% in 2022.

In 2020, the government launched a number of tools to support domestic entrepreneurs. The “Anti-crisis Shield” included the so-called Financial Shields in the form of financial subsidies for SMEs and in the form of the preferential financing for large companies, which were worth a combined total of PLN 71.37 billion (July 2021). Bank Gospodarstwa Krajowego provided support worth PLN 93.84 billion (July 2021) in the form of accessible guarantees, such as de minimis guarantees (the maximum amount of this guarantee was lifted from 60% to 80%) and liquidity guarantees (a new measure to improve the financial liquidity of medium-sized and large companies). The Anti-crisis Shield also covered other measures such as social insurance exemptions, subsidies to the remuneration of employees and idle- time benefits. The government support under the Anti-crisis Shield has amounted in total to over PLN 236 billion as of July 2021. These measures have significantly mitigated the effects of the crisis in the non-financial corporate sector.

In 2019, there were 2 211.6 thousand non-financial enterprises in Poland, which is 2.9% more than the previous year. SMEs dominate the business landscape in Poland, constituting nearly 99.9% of all firms. Micro-enterprises (less than 10 people employed) alone account for 97% of all companies in the country.

In 2020, the banking sector has remained stable. As a result of the reforms implemented after the 2008-2009 global financial crisis, the Polish banking system has generally become more resilient to shocks, due to stronger capital and liquidity buffers. In 2020, decreasing debt growth was observed among both large companies and SMEs. The biggest decline was observed in corporate loans, which to a large extent were replaced by the fiscal support provided by the government. At the end of 2020, the proportion of firms that did not experience liquidity problems reached a historical high, primarily as a consequence of the state aid liquidity measures under the Financial Shields.

The stock of outstanding business loans and SME loans slightly declined in 2020, which could be driven by a decline in credit demand and an increase in repayment rates. From March to the end of August 2020, a substantial increase in the value of corporate deposits was observed, explaining current lower demand for loans. Furthermore, at the end of 2020, over 94.5% of companies declared timely settlement of credit liabilities. There has also been a rather sustained upward trend in the volume of SME long-term loans. The share of non-performing loans (both total and SME) increased slightly in 2020, but remained visibly below the 2010 peaks reached after the financial crisis. The average interest rate, both for SMEs and large companies, declined in 2020. Similarly, the interest rate spread also fell to 0.14 percentage points. This decline can be explained by the important government support through the de minimis Guarantee Fund.

Venture and growth capital investments expanded in 2020 by almost 22% compared to 2019. In 2020, the financial results of the Warsaw Stock Exchange Group were among the best in its 30-year history. Seven companies were newly listed on the main stock market (including two transfers from the junior market, New Connect) and 14 companies were newly listed on New Connect.

In 2020, the financial results of non-financial enterprises were more unfavourable than those obtained the year before. Compared to 2019, the value of revenues decreased by 1.3% for the entire surveyed population (including small units by 3.9%, medium-sized units by 2.6%, large units by 0.2%). 13.9% of total revenues was generated by small enterprises, 24.7% by medium-sized enterprises and 61.4% by large enterprises. It is worth mentioning that at the end of 2020, the financial performance of enterprises was noticeably better than in the first half of that year.

Like revenues, financial results varied at the sector level: they were better in the group of exporters and substantially worse in industries most affected by anti-epidemic restrictions. Overall, the gross turnover profitability indicator for all non-financial enterprises decreased slightly from 4.8% to 4.7% and the net turnover profitability indicator decreased from 4.0% to 3.9%.

In enterprises with 10 or more employees, sold production of industry1 in 2020 was by 1.0% lower than in the previous year (which saw 4.0% growth). However, an increase in sold production was reported in 17 (out of 34) industry divisions.

The value of total investment outlays was (in constant prices) lower by 7.9% than a year before (in 2019 there was an increase of 11.5%). There was a marked quarter on quarter improvement in investment sentiment, which, however, remains weaker than before the pandemic. In 2021, the enterprises planning to increase this expenditure include mainly state-owned companies, large companies, exporters and industry. It is significant that exporters are more interested in expanding capacity and introducing new technologies.

Both exports and imports are expected to recover robustly in 2021 and 2022. However, imports are set to grow faster than exports.

Banking sector is the most important source of external financing for businesses. However, loans to firms as a share of GDP constitute a moderate 13-17%. Corporate bonds issued on the domestic market or new issues of shares on the Warsaw Stock Exchange do not play a key role either. Polish firms rely mostly on their own funds. Specifically for SMEs, the preferred sources of finance are trade loans, leasing, rentals and credit card or working capital loans. Preferred sources of external financing by SMEs are those that contribute to a greater flexibility of operation, faster adaptation of production capacity to economic conditions (e.g. leasing) or lower cost of financing (e.g. trade loans).

In 2020, decreasing debt growth was observed both among large companies and SMEs. As a result of the impact of the state aid liquidity measures under the Financial Shields, the demand for corporate loan decreased. In the second half of 2020 and at the beginning of 2021, the annual growth rate of loans to non-financial enterprises was negative, resulted from their limited loan demand due to the reduction in activity.

At the end of 2020, the percentage of firms which did not experience liquidity problems reached a historical high. Over 62% of companies declared that they had cash liquidity at least at a safe level (i.e. 20%), and over 94.5% of enterprises declared timely settlement of credit liabilities.

SMEs are riskier borrowers due to information asymmetry and more exposed to the restrictive credit policy2. Moreover, some sectors can be more vulnerable because of inherently higher risk and other because they are populated by SMEs.

In 2020, banks declared the lack of significant changes in lending standards. In the fourth quarter of 2020, the majority of enterprises surveyed by Narodowy Bank Polski were granted loans on the expected terms, and the loan approval rate also increased. According to the declarations, interest in bank loans was very small and 15% of the respondents were seeking a loan, with 88% of the requests being granted.

Furthermore, survey results conducted among companies do not indicate that the availability of bank financing is excessively restricted. The tightening of lending standards and terms declared by banks did not translate into a decline in the share of accepted loan applications across the corporate sector. Loan refusal rates varied depending on the financial situation and the sector of the firm. The decline in the growth of lending to enterprises resulted, among others, from the reduction in the scale of their activities as a consequence of restrictions related to the COVID-19 pandemic and high uncertainty about the future economic situation.

Central and Eastern Europe investment activity in 2020 was concentrated in a few countries. Poland was the leading destination with a quarter of the region’s total investment value and almost a fifth of the companies receiving funding. Venture capital investment (112 million EUR, an all-time high for the country) was invested into a record 82 companies. Venture and growth capital investments expanded in 2020 by almost 22% compared to 2019.

The index agent FTSE Russell classifies the Polish capital market as a Developed Market since 2018. The Warsaw Stock Exchange Group grew dynamically in 2020. The Group generated record-high sales revenue of 403.8 million PLN, record-high EBITDA of 224.6 million PLN, and a net profit of 151.4 million PLN, one of the highest ever. The equity EOB turnover value on the Warsaw Stock Exchange grew by 55.3% year on year to a record-high 297.3 billion PLN. The equity EOB turnover value on NewConnect was also historically high at 14.7 billion PLN, an increase of 925.3% year on year. The number of investment accounts reported by The Central Securities Depository of Poland rose by nearly 85 thousand as at 31 December 2020, representing an increase of 6.8% year on year and the highest growth since 2010 both in nominal numbers and as a percentage.

As of the end of 2020, 896 thousand lessees used leasing services. They leased 2 239 thousand assets or items worth 103.2 billion PLN. Leasing of means of road transport was crucial – amounted to 69.4% of the total value. Industrial machinery and equipment were important leasing segment, constituting 25.3% of the value of newly concluded contracts. Leasing companies in Poland support mainly micro and small entrepreneurs.

In 2020, the number of purchased invoices rose by 4.7%, and the value of purchased receivables decreased by 1.9% compared to 2019. Factoring services were used by 21 331 clients. 26.9% of them operated in the trade sector, 23.7% – in transport, 19.7% – in industry, and 10.4% – in services.

In the first quarter of 2021, there were 84 223 registrations of enterprises recorded (i.e. 0.1% more than in the corresponding period of the previous year). 126 enterprises declared bankruptcy (i.e. 11.3% less than in the first quarter of 2020). A decline in the number of entities that declared bankruptcy was recorded in transportation and storage; industry; construction; trade and repair of motor vehicles; information and communication; accommodation and catering.

In 2020, the total number of registrations of enterprises reached 311 794 (i.e. 12.4% less than in 2019). The number of enterprises that declared bankruptcy amounted to 528 (i.e. 8.7% less than in the previous year). The decline in bankruptcies is explained by the introduction of simplified restructuring proceedings. At the end of 2020, over 94.5% of companies declared timely settlement of credit liabilities.

In 2020, under the Anti-Crisis Shield:

  • The minimis guarantees provided support worth more than 29 billion PLN of financing value to more than 50 thousand micro, small and medium-sized enterprises,

  • Liquidity guarantees from the Liquidity Guarantee Fund provided support worth more than 5.6 billion PLN of financing value to nearly 500 thousand medium-sized firms,

  • Within the Financial Shield 1.0 for SMEs subsidies amounting almost PLN 61 billion was granted to more than 348 thousand micro, small and medium-sized companies3.

These measures significantly mitigated the course of the crisis in the non-financial corporate sector, considerably supporting its liquidity and stabilising the labour market. As of the end of 2020, support under the Anti-crisis Shield amounted in total to over 170 billion PLN.

It is worth mentioning that a New Chance Policy financial instrument was launched (with a budget of up to 120 million PLN per annum for 10 years). It consists of three components available for micro, small and medium-sized companies during the restructuring proceedings or facing the threat of liquidation.

Alongside the Anti-crisis Shield, it is expected that the Recovery and Resilience Facility will provide an additional boost to the economy. Poland joined the European Guarantee Fund and declared a share of over 1 billion EUR. The European Guarantee Fund aims to generate up to 200 billion EUR for the economy to help businesses recover from the pandemic.

Moreover, in September 2020, Europejski Fundusz Leasingowy signed with the European Investment Bank a new loan agreement worth 100 million EUR, to finance investments of Polish micro, small and medium-sized enterprises.

The Act of 19 July 2019 amending certain acts to reduce payment gridlocks contained a whole package of legal solutions combating gridlocks. Under the Act on preventing excessive delays in commercial transactions, the President of the Office of Competition and Consumer Protection conducts proceedings regarding excessive delay in payment and may impose an administrative penalty. Its amount depends, among others, on the value of late payment and the period of delay.


Bank Gospodarstwa Krajowego, Report of the Management Board on the activities of the BGK Capital Group in 2020:


European Commission, Summer 2021 Economic forecast for Poland:


GPW Group, GPW Group’s Financial Results in 2020:


Invest Europe, 2020 Central and Eastern Europe Private Equity Statistics:


Ministry of Economic Development, Labour and Technology: own calculations

Narodowy Bank Polski, Financial Stability Report:



Narodowy Bank Polski, NBP Quick Monitoring Survey, Economic climate in the enterprise sector, Summary:


Statistics Poland, Activity of leasing companies in 2020:


Statistics Poland, Działalność przedsiębiorstw niefinansowych w 2019 roku:


Statistics Poland, Factoring activity of financial enterprises in 2020:


Statistics Poland, Financial results of non-financial enterprises in I–XII 2020:


Statistics Poland, Industry – results of activity in 2020:


Statistics Poland, Rejestracje i upadłości podmiotów gospodarczych w IV kwartale 2020 roku:


Wróbel Ewa, Narodowy Bank Polski Working Papers, Shocks to bank capital position: Do they matter for lending to firms and how they are channelled? Evidence from Senior Loan Officer Opinion Survey for Poland:



← 1. Sold production concerns the total activity of an economic entity, i.e. both industrial and non-industrial production.

← 2. For more information see: Narodowy Bank Polski Working Papers, Shocks to bank capital position: Do they matter for lending to firms and how they are channelled? Evidence from Senior Loan Officer Opinion Survey for Poland.

← 3. For more information see: https://pfr.pl/aktualnosci/EN-Serwis-korporacyjny/investor-relations/main/in-january-the-pfr-20-financial-shield-will-be-launched-pln-35-billion-to-help-companies-affected-by-the-second-wave-of-covid-19.html).

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