Microfinance Ireland’s COVID-19 Business Loan Fund has been highly successful since its inception in March. Over €15.65 million in loans has been approved to 581 Irish micro businesses, and a pipeline of further applications being processed which will require the remainder of the €20 million fund. A further 760 business have been supported through restructuring or deferral arrangements for existing customers.
Lending under the MFI COVID Scheme has supported 2000 jobs across the country. However, due to this unprecedent demand, lending through this scheme has currently been paused as legislation is required to increase the funding of MFI which is currently at capacity. This legislation is currently undergoing scrutiny in the houses of the Oireachtas. Microfinance Ireland and the Department of Business, Enterprise and Innovation will work together to reopen this Loan Fund as soon as the relevant funding has been put in place through the appropriate channels.
What is the purpose of this loan fund?
The COVID-19 Business Loan from Microfinance Ireland is a government initiative to support microenterprises, through the current period of uncertainty, who are or may impacted by the coronavirus in Ireland.
Who can apply?
- Any microenterprise (Sole Trader, Partnership or Limited Company) who is currently trading
- not in a position to avail of Bank finance and
- is experiencing a COVID-19 negative impact on their business (the negative impact must be a minimum of 15% of actual or projected in turnover or profit).
What is a microenterprise?
A micro-enterprise is a business with:
- fewer than 10 full-time employees
- less than €2m annual turnover and
- a Balance Sheet with Net Worth/Capital Account/Equity that does not exceed €2m.
What are the eligibility criteria?
In order to apply for finance up to €50,000, the business must provide a declaration to Microfinance Ireland that they meet the following eligibility criteria:
- A minimum of 15% of actual or projected turnover or profit in the business is negatively impacted by COVID-19
- The business is a micro-enterprise
- The business is having difficulty in accessing finance from Banks and/or other commercial lending providers.
What are the loan features?
- Business Loans up to €50,000 for eligible micro-enterprises (Businesses with less than 10 employees and up to €2m annual turnover) that are currently trading
- Loans may be used for working capital and required business changes* as a result of COVID 19
- Loan terms up to a maximum of 3 years*
- Six months interest free and repayment free moratorium, with the loan to then be repaid over the remaining 30 months of the 36-month loan period
- Interest rate of 4.5% if submitted through Local Enterprise Office and 5.5% if you apply to Microfinance Ireland directly
- No fees and/or hidden costs with fixed repayments with no penalty for early repayment
* By exception, capital expenditure may be funded up to 5 years. Interest only period may be granted for a longer period.
Documents required to apply
- Application Form*
- COVID 19 Business Plan*
- Cashflow Forecast*
- 6 Months Bank Statements
- Central Credit Register Report (CCR) **
In addition, for loans > €25,000
- Aged list of Trade Debtors and Trade Creditors and Preferential Creditors.
*Templates available online.
**For limited companies we require a personal credit report from CCR for all shareholders and / or Directors with a 25% or shareholding the Company.
How to apply
Talk to a Business Advisor in your Local Enterprise Office
Register on microfinanceIreland.ie
Talk to one of Microfinance Ireland's loan advisors on 01 260 1007
Existing MFI loan customers
For businesses with an existing loan with Microfinance Ireland and the business is either currently impacted or may be impacted by COVID 19, please contact MFI to discuss the situation so that they can help you in getting your business back on track
More information is available on microfinanceireland.ie/loan-packages/covid19/