New €300m loan scheme for businesses affected by Brexit

It is open to businesses with up to 499 employees, with loans of up to €1.5m

New €300m loan scheme for businesses affected by Brexit

Minster Paschal Donohoe (centre) announces the Brexit Loan Scheme for Irish Businesses at the Liffey Trust in Dublin's inner city | Image: Supplied

A new €300m Brexit Loan Scheme has been set up for Irish businesses.

It is open to eligible businesses with up to 499 employees, with loans of up to €1.5m at a rate of 4%.

The Government says the scheme has the potential to benefit over 5,000 companies impacted by Brexit.

It is to be delivered by the Strategic Banking Corporation of Ireland (SBCI) in partnership with the EIB Group.

The scheme is open through Bank of Ireland and Ulster Bank, with AIB following in June.

The first step for businesses will be to complete the eligibility criteria on the SBCI website.

The Brexit Loan Scheme for Irish Businesses is announced at the Liffey Trust in Dublin's inner city | Image: Supplied to Newstalk.com

Speaking at the launch, Business Minister Heather Humphreys said: "Coming from a business background, I am acutely aware of the challenges that Brexit poses to firms. This €300m Brexit Loan Scheme is one of a number of supports that the Government has put in place to help companies prepare.

"The scheme will provide much-needed finance to eligible business impacted by the UK's decision to leave the European Union.

"I am confident that it will make a real difference to firms, enabling them to adapt, change and innovate.

"This, in turn, will help them to become more competitive, a fundamental trait in any resilient business", Minister Humphreys added.

'Importance of SME sector'

In last October's budget, €14m was secured by the then-business minister - together with €9m by the agriculture minister for the loan scheme.

Finance Minister Paschal Donohoe said: "The Government recognises the importance of the SME sector to the Irish economy and the potential risks that Brexit will bring to this sector.

"This scheme is designed to assist SMEs with their short term working capital needs, supporting them in preparing for the challenges that may lie ahead.

"It will give SMEs time and the financial support to make the necessary changes to help ensure that their businesses remain competitive so that they can continue to grow into the future."

Earlier this year, ministers signed a counter guarantee agreement through the European Investment Fund (EIF), which is part of the European Investment Bank Group (EIB), so that the €23m secured in Budget 2018 can be leveraged to provide €300m to Irish businesses.

EIB vice-president for Ireland, Andrew McDowell, said "This €300m joint scheme with SBCI to address Irish companies' working capital challenges, bears testament to the EIB Group's strengthened support to enable new investment by thousands of companies across Ireland at a time of uncertainty relating to Brexit."