On 13 March 2020, the Bank of Mauritius announced a support programme to boost the Mauritian economy amidst the global economic fallout from the COVID-19 pandemic. The programme results from consultation with the Mauritius Bankers Association and is being deployed alongside a plan published on the same day by the Ministry of Finance, Economic Planning and Development providing support to businesses to minimize the adverse impact of COVID-19. At this time, the focus of the Bank of Mauritius rests on addressing employment, cash-flow and business continuity issues facing the Mauritian economy.

Monetary policy

The programme follows the decision of the Monetary Policy Committee of the Bank of Mauritius on 10 March 2020 to cut its Key Repo Rate from 3.35% to 2.85% to support domestic activity. In announcing the programme, the Bank of Mauritius recognises that monetary policy alone will not be enough to address the expected drop in economic activity and in particular, the cash flow contraction that businesses will experience. As a result, the programme contains five key measures which aim to incentivize commercial banks to support businesses which are impacted by COVID-19.

Easing bank rules

The programme introduces a Special Relief amount of MUR 5 billion to assist businesses whose cash flow and working capital have been adversely affected by COVID-19. The Special Relief amount will be available through commercial banks. Loans under this measure will be provided between 23 March until 31 July 2020 for a term of 2 years with an interest rate cap at 2.5% per annum and will be subject to a moratorium of 6 months for the payment of capital and interest. A moratorium of 6 months on capital repayments will also be applied to existing loans to businesses which have been impacted by COVID-19. These measures will be accompanied by a reduction from 9% to 8% in the Cash Reserve Ratio applicable to commercial banks.

The programme also announces the temporary suspension of the application of the Bank of Mauritius Guideline on Credit Impairment Measurement and Income Recognition with immediate effect. The suspension is intended to allow commercial banks to support businesses having cash flow and working capital difficulties.

Lastly, the programme announces the introduction of a 2020 Savings Bond to be issued by the Bank of Mauritius as from 23 March 2020. The savings bond will be issued for a total amount of MUR 5 billion with a coupon of 2.5% and maturity of 2 years. Subscription will be open to individuals who are resident of Mauritius and locally registered non-profit NGOs, and will be subject to a cap per investor.


The Bank of Mauritius will monitor the effectiveness of the programme and remains open to implementing further measures to maintain the stability of the mauritian Financial System.  The full article for Bank of Mauritius programme can be found on its website.