Dáil Éireann Debate, Thursday - 3 June 2021
206. Deputy Fergus O'Dowd asked the Tánaiste and Minister for Enterprise, Trade and Employment if his attention has been drawn to the concerns being raised in respect of taxi operators access to microfinance; and if he will make a statement on the matter. [30340/21]
View answerSince the onset of the pandemic, my Department has made loan supports available to businesses that have been impacted by COVID-19. These schemes will also support enterprises as they look towards rebuilding their business. These loan schemes are available to SMEs which include microenterprises and sole traders such as taxi operators, subject to meeting eligibility criteria and being able to demonstrate that they are viable business operations and are in a position to repay the loan.
- The COVID-19 Credit Guarantee Scheme is the biggest ever state-backed loan guarantee in Ireland. The Scheme provides €2 billion in lending, for terms between three months and five-and-a-half years and offers a range of lending products between €10,000 and €1 million including working capital and term loan facilities. Loans of up to €250,000 are unsecured. As a result of the high level of the State guarantee, loans are being provided at interest rates lower than the current market rate for similar loans.
- The COVID-19 Business Loan provides up to €25,000 to eligible micro-enterprises through Microfinance Ireland with zero repayments and zero interest for the first six months and the equivalent of an additional six months interest-free, subject to certain terms and conditions. Microfinance Ireland also provides start-up business loans and loans for established businesses for up to €25,000 with interest rates of between 6.8% and 7.8%.
- The COVID-19 Working Capital Scheme makes lending available from participating lenders to eligible businesses. Loans available under the scheme range from €25,000 to €1.5 million and are for terms of up to three years. Loans are offered at favourable terms, including a maximum interest rate of 4% and no security on loans of up to €500,000.
- The Brexit Impact Loan Scheme is a new scheme which is being introduced in recognition of the additional effects of COVID-19 on Brexit impacted businesses. The Brexit Impact Loan Scheme will provide loans with terms of up to six years with loans to be made available for liquidity/working capital and investment purposes. Loans will range from €25,000 to €1.5m, with loans of up to €500,000 available unsecured. The Brexit Impact Loan Scheme will be launched in summer 2021 and will replace the existing Brexit Loan Scheme.
While the State provides funding or guarantees on these loans, the Department plays no role in the application or decision-making process in relation to loans offered under these schemes, which is fully delegated to the participating lenders.
Where an applicant has had a loan application refused, they may wish to appeal the decision through the individual lender’s appeals system. An appeal to the Credit Review Office (CRO) is a further option if the lender is a participating bank. The CRO helps SMEs who have had an application for credit of up to €3 million declined or reduced by the main banks. This is a strictly confidential process between the business, the CRO and the bank.
I can assure the deputy that officials from my Department are in regular contact with the Strategic Banking Corporation of Ireland and Microfinance Ireland, the operators of these schemes, to ensure the effective implementation of these schemes.
