Greece introduces lower interest rates and longer payment plans for debtors

The Greek Ministry of National Economy and Finance is introducing new measures to protect borrowers and debtors with outstanding obligations to banks, tax authorities, and the social security fund, EFKA.

Minister Kyriakos Pierrakakis proposed legislation that sets a fixed interest rate of 3% for debts restructured through the Out-of-Court Debt Settlement Mechanism. This change applies to vulnerable borrowers and eligible debtors and will take effect for repayments starting 1 December 2026.

The government is also expanding the scope of the settlement mechanism to include debts of at least €5,000. This change allows more people to qualify for the program, which offers benefits such as the suspension of enforcement measures and extended repayment periods. For debts to the state, borrowers can pay over 20 years, while bank and fund debts can be repaid over up to 35 years.

The mechanism may also propose partial write-offs of principal amounts or surcharges based on the debtor's income and assets. Additionally, the government plans to launch a new AADE platform in mid-November to help taxpayers settle debts to the tax authorities and EFKA. This platform will allow households and businesses to pay off debts that became overdue by the end of 2024 in up to 120 monthly instalments, extending the repayment period to ten years.

To qualify, applicants must have a minimum monthly payment of €30, no convictions for tax evasion or smuggling, and must have submitted all income tax returns for the previous five years.