Three of the country’s biggest lenders will take part in the scheme, which – it’s hoped – will create over 1300 jobs per annum.

From today, more than 5,500 small businesses could benefit from the €450 million credit guarantee scheme.

Every year, for the next three years, €150 million from the scheme’s pot will be made available for new lending – but it cannot be used to cover existing debt.

Bank of Ireland, AIB and Ulster Bank are all taking part – the government’s hoping other lenders will sign up too.

The aim is to provide much-needed credit to job-creating SMEs, who struggle to get finance from banks.

Targeted businesses will be those that fail to attract funding because they have inadequate collateral, or because their business idea is new and not well understood.

Loans of between €10,000 and €1 million will be given out to businesses that can prove they have a solid business model and a clear market niche ensuring their ability to repay loans.

To participate, they must first apply for bank funding as normal, before approaching the credit-guarantee scheme on being refused.

Aedín Donnelly reports: