The Government (on March 27) launched the Future Growth Loan Scheme to allow for the roll out of €300 million in funding to eligible Irish SMEs including farmers.
Businesses will be able to apply for loan eligibility through the SBCI from 17th April. Three finance providers – AIB, Bank of Ireland and KBC – have agreed to participate in the Scheme and negotiations are ongoing with another two. The Government is urging businesses to use the coming three weeks to start preparing their proposals for long-term capital investment.
Minister for Business, Enterprise and Innovation, Heather Humphreys, said “With Brexit on the horizon, investment in innovation and diversification has never been more important. For this reason, I would strongly encourage businesses to started putting their proposals together now so that they are ready to start the application process with the SBCI.
“Even if firms are unsure if they will draw down a loan, it’s a good idea to have approval in place in case it’s something they need down the line. Notwithstanding the uncertainty that comes with Brexit, it’s better to be safe than sorry.”
This Scheme unlocks a large fund of affordable investment financing for the future needs of businesses, and it follows on from the Government’s launch last year of the €300 million Brexit Loan Scheme, which provides working capital support for businesses. Other State supports available to firms include those through Enterprise Ireland, InterTrade Ireland and the Local Enterprise Offices.
The funding allocations for the Future Growth Loan Scheme are €37m from the Department of Business, Enterprise and Innovation and €25m from the Department of Agriculture, Food and the Marine. Of the total budget, €42 million relates to expenditure in 2018 with a further €6 million allocated in 2019 and the remaining €14 million over a third tranche. The Department of Agriculture, Food and the Marine’s share of funding ensures that at least 40% of the fund will be available to farmers and agri-food & seafood businesses.
Minister for Agriculture, Michael Creed added: “This is a long-awaited source of finance for young and new entrant farmers, especially the cohort who do not have high levels of security. It will also serve smaller-scale farmers, who often do not have the leverage to negotiate for more favourable terms with their banking institution. Along with products such as Milk Flex, this Scheme will form part of a comprehensive investment package for farmers and those in the seafood sector.”
This scheme will be available to eligible Irish SMEs including farmers and the agri-food & seafood sectors, to support strategic long-term investment in a post Brexit environment.
Andrew McDowell, European Investment Bank Vice President said that Irish companies continue to suffer from Brexit uncertainty. “As the EU Bank, the EIB Group is committed to supporting Ireland to mitigate the economic damage to Irish companies.
Backed by both the European Investment Bank and the European Investment Fund, the new Future Growth Loan Scheme will enable companies most exposed to Brexit to access EUR 300 million of new long-term financing to make investments that protect jobs and help them to expand into new markets.
The Scheme builds on the success of two successful financing initiatives delivered by SBCI and backed by the EIB Group and complements our strengthened direct lending support for Irish business investment,” he said. The new EIF support for business investment in Ireland is backed by the European Fund for Strategic Investments.