The European Commission has said it will mobilise up to €100 billion in loans for member states to help companies hold on to staff during the coronavirus pandemic.
The loans will be based on guarantees provided by member states, according to a statement by the European Commission president Ursula von der Leyen.
"All member states will be able to make use of this but it will be of particular importance to the hardest-hit," she told a virtual news conference.
The loans are designed to help countries cover the costs of national short-term work schemes and measures put in place for the self-employed, in order to keep employees on companies' books.
The Commission says it will borrow on the financial markets to finance the loans to member states, which will be granted on what the Commission calls "favourable conditions".
The loans will be underpinned by voluntary guarantees from member states and will be made available once member states have "committed" to the guarantees.
President von der Leyen said the scheme, called SURE, was designed to ensure that when the virus emergency passed, companies would be able to rebound as they were able to retain staff.
The Commission said the loans should be used by national capitals to finance short term work schemes for employees, or similar measures for the unemployed.
Once a member state requests financial assistance, the Commission will then verify the increase in public expenditure related to the creation or extension of such schemes.
On this basis the Commission will evaluate the terms of the loan, including the amount, the maximum average maturity and pricing.
All loans will then have to be approved by ministers from member states.
Member states will have to commit to providing guarantees for up to 25% of the maximum overall loans, which the Commission says can be up to €100bn.
Ms von der Leyen said: "In this coronavirus crisis, only the strongest of responses will do. We must use every means at our disposal. Every available euro in the EU budget will be redirected to address it, every rule will be eased to enable the funding to flow rapidly and effectively.
"With a new solidarity instrument, we will mobilise €100bn to keep people in jobs and businesses running. With this, we are joining forces with Member States to save lives and protect livelihoods. This is European solidarity."