€330m Brexit Impact Loan Scheme to Help SMEs

By Steven Galvin - Last update

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A Brexit Impact Loan Scheme (BILS) of €330m has been launched by government to help SMEs, farmers and fishers respond to the ongoing impacts of Brexit.

The Brexit Impact Loan Scheme (BILS) is a successor to the Brexit Loan Scheme and provides low-cost loans to eligible Brexit-impacted businesses. The new Scheme is also open to businesses in the primary agriculture and seafood sectors and the loans under the scheme are for terms of up to six years. The scheme is delivered by the Strategic Banking Corporation of Ireland (SBCI) through participating lenders.

Brexit Impact Loan Scheme

Tánaiste and Minister for Enterprise, Trade and Employment, Leo Varadkar TD said:

“The combination of Brexit and the pandemic have created the perfect storm for many businesses, particularly those in our agri-food industry. The government, through the different loans and grants we have made available, has sought to help mitigate the consequences of both.

“This new Brexit Impact Loan Scheme gives those who need it, access to low-cost loans of between €25,000 and €1.5m. These loans can be used to invest in new technologies, necessary upgrades or changes to the business, or even new staff. It can also be used to help with liquidity or, in some instances, refinancing of existing loans. I hope this Scheme is another weapon in the armoury of businesses who are still adapting to a post-Brexit trading environment.”

In response to feedback about the previous Brexit Loan Scheme, steps have been taken to simplify the application process, while the lending is now available for longer terms, in line with lending offered under the COVID-19 Credit Guarantee Scheme.

Minister for Agriculture, Food and the Marine, Charlie McConalogue TD said:

“The Brexit Impact Loan Scheme will assist the agri-food sector in countering the effects of Brexit, which will continue to unfold in the weeks and months ahead. I am pleased with the enhancements over the previous Scheme and that now, as well as assisting food businesses, the Department of Agriculture, Food and the Marine’s support will facilitate the Scheme’s availability to farmers and fishers. We are all aware that the agri-food sector is uniquely exposed to the economic disruption arising from the UK’s withdrawal from the EU and the government remains committed to providing appropriate supports to all in the sector.”

Minister for Finance Paschal Donohoe TD said:

“The government is committed to supporting our SME sector who are facing the twin challenges of COVID-19 and Brexit. Alongside the COVID-19 Credit Guarantee Scheme, the Brexit Impact Loan Scheme will provide longer loan terms of up to 6 years for the SME sector including primary producers who continue to face difficulties adjusting to Brexit. In particular, I welcome that the BILS will be available not just from retail banks but also from select Credit Unions around the country.”

June Butler, CEO of SBCI said:

“The new, enhanced Brexit Impact Loan Scheme (BILS) will support SMEs throughout Ireland as they deal with the challenges of Brexit. The SBCI is delighted that this scheme will add significantly to its range of SME-friendly finance options and help more SMEs get access to low-cost, flexible finance. The coming year will bring new challenges to many Irish SMEs as the UK phases in border controls, with timeframes for certain sectors now spread across 2022. When in place, these controls will particularly affect key sectors in our economy, such as primary agriculture, seafood and food and drink, and we have designed the BILS to offer broader terms that will be of significant benefit to SMEs in these and other sectors.”

Christian Kettel Thomsen, Vice President of the European Investment Bank said:

“Companies across Ireland are facing unprecedented challenges as a result of Brexit and the COVID-19 pandemic. The European Investment Bank Group is committed to backing targeted support that ensures that Irish business can access finance and investment in new business opportunities. The €330m Brexit Impact Loan Scheme will ensure that businesses, agriculture and fishing can successfully overcome new pressures. I look forward to discussing further European Investment Bank and European Investment Fund support for priority business, climate action, digital and strategic investment with Irish Ministers in Dublin later this month.”

The Brexit Impact Loan Scheme is supported by a guarantee through the European Guarantee Fund (EGF), which is being implemented by the European Investment Fund (EIF) on behalf of the European Commission. The first of the participating lenders is Bank of Ireland, with other banks and credit unions to open for applications in the coming weeks.

Francesca McDonagh, CEO of Bank of Ireland Group said:

“Bank of Ireland has made it a priority to support businesses through Brexit. We are delighted to immediately offer the Brexit Impact Loan Scheme to new and existing customers to continue that support. As a leading lender to Ireland’s agri-food sector we look forward to offering the scheme to agriculture and seafood businesses across the country.”

Brexit Impact Loan Scheme

The Brexit Impact Loan Scheme will provide low-cost loans to Brexit-impacted Irish businesses, including those in the primary agriculture and seafood sectors. The scheme makes a fund of up to €330m available to eligible businesses with up to 499 employees.

Loan features:

  • loans range from €25,000 to €1.5m
  • loan terms from 1-6 years
  • loans of up to €500,000 available unsecured

Loans can be used for:

  • liquidity/working capital
  • investment
  • 100% refinancing of existing Brexit Loan Scheme loans
  • refinancing of existing short-term credit, up to a maximum of 30% of the new loan

Businesses eligible for the scheme:

This scheme is available to eligible SME and small Mid-Cap businesses, including primary producers (businesses engaged in farming and fishing), established in Ireland.

A business must also have experienced an adverse impact of minimum 15% in actual or projected turnover or profit due to the impact of Brexit.

Loans provided under the scheme will be lower than is otherwise typically available on similar lending in the market and will vary according to the lender. Lenders participating in the scheme will be separated into two cohorts. For the first, interest rates will be variable, but are capped at an initial maximum rate of 3.7% for loans less than €250,000 and 2.75% for loans of €250,000 and above. For loans from the remaining lenders, a minimum discount of 1% relative to their standard rates will be required to for loans under the BILS.

COVID-19 Credit Guarantee Scheme

One year on from its launch, the COVID-19 Credit Guarantee Scheme has seen unprecedented demand from COVID-19-impacted businesses with more than 7,300 loans sanctioned with a value in excess of €500m. This scheme’s participants include 19 Credit Unions and seven non-bank lenders, adding diversity and regional spread to the loans available.

Together, the Brexit Impact Loan Scheme and COVID-19 Credit Guarantee Scheme will help Irish business to recover and adapt in response to both Brexit and COVID-19.

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Steven Galvin

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