If you receive basic income support, you’ll get a lump-sum payment. This is the budget for what’s known as the “standard allowance.” You must use this budget to cover both your ongoing—that is, regularly recurring—and your irregular expenses for your needs.

The standard needs allowance takes into account, in particular, expenses for:

• Food
• Clothing
• Personal hygiene
• Household goods
• Household energy, excluding the portions attributable to heating and hot water production
• personal needs of daily life, including participation in social and cultural life

If, due to special circumstances, your budget is insufficient to cover your daily needs in the short term, the Job Center may, upon application, grant you an interest-free loan to cover these essential needs.

An unavoidable need exists

• if it cannot be postponed, as this would otherwise lead to an acute emergency, and
• it cannot be expected that you will be able to cover this need with your next basic income support payments.

Examples include:

• necessary repairs
• necessary purchases, such as new winter clothing for growing children
• an impending disconnection of the electricity supply, for example, household electricity due to so-called “new debts.” These are debts that arose while you were receiving basic income support. A loan is possible if you cannot prevent the power disconnection in any other way, such as by making installment payments to the utility provider.
• Theft or loss
• Fire in your apartment or house

You must apply for the loan separately and, as a general rule, provide proof of the undeniable need. If you have assets, you must first use them to finance the expenses. Depending on the circumstances, the Jobcenter may also instruct its field staff to assess the need.

The Jobcenter may also decide to provide you with benefits in kind instead of cash. In that case, the loan amount will correspond to the value of the necessary expense—that is, the purchase price.

You must use the loan for the specified purpose. The Job Center may require proof of this, such as a receipt.

You must repay the loan. Repayment begins the month following the disbursement of the loan. If you continue to receive basic income support, the loan will be deducted monthly from your benefit entitlement. As a rule, you will then receive 5 percent less of your applicable standard benefit amount until the loan is repaid. You will be informed in writing of how the loan will be offset in your specific case.