The Strategic Banking Corporation of Ireland (SBCI) was created to ensure increased lending, at a lower cost, to Irish SME's by channelling lower cost financing from EIB and KfW though lending partners known as on-lenders.
All on-lending partners of the SBCI, including AIB and Bank of Ireland are required, under contract, to pass on to their borrowers the full extent of the financial advantage accruing as a result of the SBCI's discounted interest rate. They are to achieve this by charging each relevant borrower a reduced rate of interest compared to the on-lender's standard rate of interest for a comparable loan.
The on-lender may pass on the reduction either by offering a single discount on each individual loan or by offering a single discounted interest rate to all customers within a portfolio. The on-lender also has the discretion to supplement the SBCI discount with a further reduction, of its own, in the interest rate it charges. The percentage discount varies between on-lenders and from time to time in accordance with interest rate market movements; however, the on-lender is obliged at all times to pass on to the borrower the full discount.
In all marketing or promotional material for the lower-cost SBCI loans, on-lenders are required to confirm that the loans are supported by the SBCI and its funders. The on-lender is also obliged to maintain a dedicated webpage on its website to provide information on SBCI funded products, and the SBCI has confirmed that each on-lender is currently complying with this requirement.
The relevant webpages for AIB and Bank of Ireland are as follows:
http://business.aib.ie/products/finance-and-loans/sbci-loan
http://businessbanking.bankofireland.com/credit/business-loans/strategic-banking-corporation-of-ireland/.