Wednesday, 3 July 2019

Questions (93)

Tony McLoughlin

Question:

93. Deputy Tony McLoughlin asked the Minister for Agriculture, Food and the Marine the status of the future growth loans scheme; and if he will make a statement on the matter. [28267/19]

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Written answers (Question to Agriculture)

The Future Growth Loan Scheme has been open for loan eligibility applications through the Strategic Banking Corporation of Ireland's (SBCI) website since 17th April. I was pleased to launch the Scheme earlier this year with my colleagues, and I recently attended Bank of Ireland's own launch of the product. Bank of Ireland is open for applications and drawdowns of approved loans. The SBCI continue to engage with other banks on their timetable for the Scheme and additional announcements in this regard are expected shortly.

The Scheme was developed by my Department and the Department of Business, Enterprise and Innovation, in partnership with the Department of Finance, the SBCI and the European Investment Fund (EIF). It will be delivered through participating finance providers and make up to €300 million of investment loans available to eligible Irish businesses, including farmers and the agri-food & seafood sectors.

The loans will be competitively priced with an initial maximum loan interest rate of 4.5% for loans less than €250,000. The loans are for terms of 8-10 years and unsecured up to €500,000. This type of innovative finance, which has been previously unavailable in the Irish market, will support strategic long-term investment in a post-Brexit environment.

A minimum loan amount of €100,000 applies up to a maximum of €3,000,000 per applicant. However, considering the needs of Irish farmers, I have negotiated a specific minimum of €50,000 for them.

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.

Food companies have identified long term investment finance of up to ten years as a critical need which is currently unavailable in Ireland.

I am pleased that the Government have been able to deliver this product and its effects will be felt all along the food production chain, from primary producer to processor.