02 Sep 2020 | 07.16 am
SBCI’s Covid-19 Schemes Off To A Good Start
Back to Business with SBCI-funded loan
02 Sep 2020 | 07.16 am
THE SBCI COVID-19 WORKING CAPITAL SCHEME IS OFFERED IN PARTNERSHIP WITH THE DEPARTMENT OF BUSINESS ENTERPRISE AND INNOVATION, AND THE DEPARTMENT OF AGRICULTURE FOOD AND THE MARINE.
THE LOANS ARE AVAILABLE THROUGH AIB, BANK OF IRELAND AND ULSTER BANK. BUSINESSES COMPLETE A LOAN APPLICATION AFTER THEY HAVE RECEIVED THEIR ELIGIBILITY LETTER FROM THE SBCI
The Covid-19 crisis has shown how much SMEs need funding support, now more than ever. The pandemic has severely affected all sectors of the economy and businesses are facing unprecedented challenges. Many businesses have experienced difficulties in accessing credit.
Within six weeks of the first case emerging in Ireland, the SBCI brought the dedicated Covid-19 Working Capital Loan Scheme to the market, as part of the government’s response to the pandemic. This scheme will deploy, over time, up to €375m in low-cost finance, with loans between €25,000 and €1.5m available at a maximum interest rate of 4% and loans up to €500,000 being unsecured.
Following its launch, more than €30m was approved in loans by the banks participating in the scheme (AIB, Bank of Ireland and Ulster Bank), getting off to a strong start and helping SMEs get through these tough months and years ahead.
The two-step eligibility process for the Covid-19 Working Capital Loan Scheme is straightforward. Firstly, SMEs should visit the dedicated Covid-19 Scheme page on the SBCI website, complete the eligibility application form and email or post it back to the SBCI.
Within 72 hours, eligible applicants will receive a confirmation letter. The SME can then take this letter of eligibility to one of the participating banks to commence the loan application.
Expanded Credit Guarantee Scheme
The existing Credit Guarantee Scheme is also available to support SMEs at this challenging time. Relaunched in 2018, the Credit Guarantee Scheme aims to assist viable SMEs which, under normal lending criteria, are unable to borrow from their bank. SMEs can avail of this support directly from AIB, Bank of Ireland and Ulster Bank.
As part of the government’s stimulus package, the Scheme’s capacity will be expanded by €2 billion. In addition, an expanded Future Growth Loan Scheme will see a further €500m injected into the long-term finance market.
€1.5 Billion SME Loans
Since it started its lending activity in March 2015, the SBCI has already supported more than 30,000 Irish SMEs with more than €1.5 billion in low-cost, SME-friendly loans and leasing products, helping businesses in almost every sector — food, agri-business, retail, manufacturing, tourism, services, technology and many others — by making finance available at interest rates well below current market rates (for example, the Future Growth Loan Scheme rates range from 3.5% to 4.5%).
The ability to access working capital is critical to ensure that SMEs can work their way through this crisis. Therefore, the SBCI’s commitment is to continue developing products and on-lender relationships to deliver effective financial support to Irish firms, as well as driving competition in the credit market to ensure the efficient use of both government and EU funding and guarantees.
Photo: Nick Ashmore, CEO, Strategic Banking Corporation of Ireland