The Government has called on financial providers to join a new Brexit Impact Loan Scheme, which will be launched over the coming period.

Tánaiste Leo Varadkar, and Minister for Enterprise, Trade and Employment 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.’

Brexit Impact Loan Scheme

The new scheme will be supervised by the Strategic Banking Corporation of Ireland (SBCI) and will make up to €330m available in lending to help those businesses impacted by Brexit.

The Loan Guarantee Schemes Agreement (Strategic Banking Corporation of Ireland) Bill 2021 was published earlier this month.

‘Businesses will continue to need help as the situation unfolds and especially when Britain introduces its border and customs controls later this year’ said the Tánaiste.

‘We have designed a new Brexit Impact Loan Scheme, with loans of up to 6 years being available.’
Once initiated, the scheme will open to SMEs (Small and Medium Enterprises), and small mid-caps (businesses of up to 499 employees) including those in farming and fishing.

How the Loan Works

The loans are expected to range from €25,000 to €1.5m, and be available for liquidity or investment purposes, including refinancing of 30% of specific forms of existing debt.

The scheme will also see loans be from one to six years with a discounted interest rate, and up to 500,000 will be available unsecured.

The Minister for Finance Paschal Donohoe T.D. said ‘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.’

Participating lenders on loans to Brexit– impacted businesses will provide an 80% guarantee and will supported by a counter-guarantee through the European Guarantee Fund which is managed by the European Investment Bank Group.

The European Investment BanK Group central focus is to support Europe’s small and medium businesses through financial help.

SBCI

SBCI Interim Chief Executive, Ian Black said ‘The 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.’

The SBCI’s goal is to ensure lower cost – longer term funding for Irish SMEs by flexible products with longer maturity and capital repayment flexibility, lower cost funding to financial institutions and market opportunities to new entrants to the SME lending market, creating competition.