The Tánaiste and Minister for Enterprise, Trade and Employment Leo Varadkar T.D., Minister for Agriculture, Food and the Marine Charlie Mc McConalogue T.D. and Minister for Finance Paschal Donohoe T.D. are today (Thursday the 6th of May 2021) calling on financial providers to take part in a new Brexit Impact Loan Scheme, which will be launched over the coming period.
The new Scheme, which will be administered by the Strategic Banking Corporation of Ireland (SBCI) will make up to €330m in lending available to help businesses continuing to respond to Brexit.
The Tánaiste said:
“The pandemic has masked the effects of Brexit. We don't really know yet how much of the trade impact has been caused by Brexit and how much by the virus. Businesses will continue to need help as the situation unfolds and especially when Britain introduces its border and customs controls later this year. We have designed a new Brexit Impact Loan Scheme. It will provide for up to €330 million in lending, with loans of up to 6 years being available. Today, through SBCI, we are inviting all financial providers, banks and credit unions to take part.”
Minister for Agriculture, Food and the Marine Charlie McConalogue T.D. said:
“I am delighted with the announcement of the open call for lenders under the new Brexit Impact Loan Scheme. Access to finance is a critical need. This Scheme will deliver important support to farmers, fishers, food businesses and to businesses generally as we seek to ensure their ongoing viability will not be hindered by a lack of suitable finance.”
The Minister for Finance Paschal Donohoe T.D. said:
“The Brexit Impact Loan Scheme will provide longer loan terms of up to six years for the SME sector, who continue to face the significant challenges of not only COVID-19 but also adjusting to Brexit. I am encouraging banks and non-bank lenders to apply to participate as part of the Brexit Impact Loan Scheme. It is my hope that we can make the Scheme available to Brexit impacted businesses through as wide a range of channels as possible.”
The Loan Guarantee Schemes Agreements (Strategic Banking Corporation of Ireland) Bill 2021 is being published today and will provide the legislative basis for the Ministers to enter into an agreement with the Strategic Banking Corporation of Ireland to implement the Brexit Impact Loan Scheme.
Once launched, it is intended that the scheme will be open to SMEs and small-mid caps (businesses of up to 499 employees), including those engaged in farming and fishing. It is expected that loans under the scheme will range from €25,000 to €1.5m and will be available for liquidity or investment purposes, as well as for refinancing of specific forms of existing debt.
Loans will be for terms of one to six years with a discounted interest rate, and loans of up to €500,000 will be available unsecured.
The scheme will provide an 80% guarantee to participating lenders on loans to Brexit-impacted businesses and will be underpinned by a counter-guarantee through the European Commission’s pan-European Guarantee Fund, which is managed by the European Investment Bank Group.
The updated Scheme will be delivered by SBCI and will be launched over the coming weeks.
SBCI Interim Chief Executive, Ian Black said:
“The Brexit Impact Loan Scheme is designed to assist businesses in dealing with the challenges presented by Brexit and the need to change or adapt their business models as a result. Today’s open call confirms the SBCI’s continued commitment to supporting SMEs as they emerge from the COVID-19 pandemic and adjust to a post-Brexit trading environment.”
ENDS
Notes to Editor
About the Brexit Impact Loan Scheme
The Brexit Impact Loan Scheme will provide affordable financing to Brexit-impacted Irish businesses, including those in the primary agriculture and seafood sectors. The scheme, which will be delivered by the Strategic Banking Corporation of Ireland (SBCI) through commercial lenders and will make a fund of up to €330 million available to eligible businesses with up to 499 employees.
Loan Features:
- Loans range from €25,000 to €1.5m
- Loan terms from 1-6 years
- Loans of up to €500,000 available unsecured
Loans can be used for:
- Liquidity/Working capital
- Investment
- 100% refinancing of existing Brexit Loan Scheme loans
- Refinancing of 30% of new loans to cover refinancing of existing short-term credit, e.g., as arising due to Covid-19 impacts.
About the SBCI
As Ireland’s national promotional financial institution, the SBCI’s goal is to ensure access to lower cost longer term funding for Irish SMEs by facilitating the provision of:
- flexible products with longer maturity and capital repayment flexibility and, in some instances, the provision of a partial guarantee subject to credit approval
- lower cost funding to financial institutions, the benefit of which is passed on to SMEs
- market access for new entrants to the SME lending market, creating real competition
The funding is available to SMEs through the SBCI partners. The release of long-term funds by promotional (or state-backed) financial institutions, through frontline (or traditional) finance providers is a successful and effective model for funding SMEs throughout Europe. The SBCI is a vital part of the country’s financial architecture. By taking a fresh approach to providing access to lower cost finance for SMEs in Ireland, the SBCI is actively supporting the long-term potential of the sector to drive economic growth and create jobs.
About the EIF
The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them access finance. EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment.
The Department of Enterprise, Trade and Employment (DETE) plays a key role in implementing the Government’s policies of stimulating the productive capacity of the economy and creating an environment which supports job creation and maintenance. The Department has lead responsibility for Irish policy on global trade and inward investment and a remit to promote fair competition in the marketplace, protect consumers and safeguard workers.
For further information please contact Press Office, D/Enterprise, Trade and Employment, press.office@enterprise.gov.ie or (01) 631-2200
If you no longer wish to receive emails from the Department of Enterprise, Trade and Employment Press Office, please notify us by email to press.office@enterprise.gov.ie