3rd August 2018
Scheme has provided over €93m in lending to SMEs that supports over 3,500 jobs
Minister of State for Trade, Employment, Business, EU Digital Single Market and Data Protection, Pat Breen TD, today welcomed the latest Quarterly Report from the Strategic Banking Corporation of Ireland (SBCI) on its operation, on behalf of the State, of the Credit Guarantee Scheme (CGS) for SMEs.
The aim of the CGS is to assist viable SMEs, which under normal lending criteria are unable to borrow from their bank, in accessing credit. A new version of the CGS, which was launched by Minister Breen in July of this year, contains a number of additional features such as an increase in the level of guarantee to participating financial providers from 75% to 80% on qualified loans to SMEs. The CGS’s key features include facilities of €10,000 up to €1,000,000; terms of up to 7 years; term loans, demand loans and performance bonds.
The latest Report shows that in Q2 of 2018, CGS Facilities were sanctioned for 27 Irish SMEs, involving funding of over €4.5 million, to allow borrowing that will help to create or maintain 147 Irish jobs.
Since the CGS became operational in October 2012, 587 facilities totalling €93.4 million have been sanctioned which have helped to support 3,666 jobs.
Commenting on the publication of the latest Quarterly Report today, Minister Breen said: “I am pleased to see that the Credit Guarantee Scheme continues to support Irish SMEs in every region. The new scheme, which I launched in July, will build on the great supports that have been in place since 2012 and will encourage even greater participation. It increases the guarantee to financial providers from 75% to 80%; has a lower premium charge for the first year, and has the potential for extension beyond the banks to other financial providers. I would encourage SME operators seeking to grow and develop their businesses to consider the benefits of the Credit Guarantee Scheme.”
Notes for editors
The Credit Guarantee Scheme is provided by the Government through the Minister for Business, Enterprise and Innovation to facilitate lending to viable Micro, Small and Medium-sized Enterprises (SMEs) which would otherwise be declined by lenders due to insufficient collateral for the additional facilities and/or growth/expansionary SMEs which due to their sectors, markets or business model are perceived as a higher risk under current credit risk evaluation practices. The Scheme can be used to facilitate refinance if related to circumstances where the SME’s bank is either unwilling to extend or (ii) unable to provide the credit sought or has sold SMEs debt to a 3rd party.
The Scheme enables the borrower to access finance which would not otherwise have been available. The borrower contributes to the cost of the Scheme by paying a premium of up to 2% on the outstanding annual balance of the Scheme Facility to the Minister for Business, Enterprise and Innovation.
The Department of Business, Enterprise and Innovation (DBEI) plays a key role in implementing the Government’s policies of stimulating the productive capacity of the economy and creating an environment which supports job creation and maintenance. The Department also has a remit to promote fair competition in the marketplace, protect consumers and safeguard workers.
For further information please contact Press Office, D/Business, Enterprise and Innovation, firstname.lastname@example.org or (01) 631-2200.
Second Quarter Report of 2018 detailing the analysis and performance of the SME Credit Guarantee Scheme
Back to Department News