Financial advice: Brexit as an opportunity for Irish SMEs to get financial support

Financial advice: Brexit is an opportunity for Irish SMEs to get access to soft loans

It is no secret that Brexit is in danger of damaging SMEs in Europe. However, if you’re a business owner you might be somewhat relieved to find that there is a scheme in place to combat this. The EU have released financial support in the form of the Brexit Loan Scheme to help SMEs deal with the challenges that may arise due to Brexit. Of all the countries in Europe, Ireland will be the most affected by Brexit which means that right now Irish SMEs have access to soft loans that are guaranteed by Europe!

Are you an SME looking for extra finance?

The Brexit Loan Scheme is a fantastic way for Irish SMEs to obtain financial support right now. The amount of the loan can range from between €25,000 to €1.5m per SME and the maximum interest rate is just 4%. If your SME could do with some extra finance the Brexit Loan Scheme is worth looking into.

Are you eligible for the Brexit Loan Scheme?

The first step for the SME looking to apply for the Brexit Loan Scheme is to make their case that they are eligible. This can put businesses off, especially if they do not export or import from the UK. The scheme is designed to be as open as it can be for SMEs and, therefore, the rules around eligibility are rather broad. If you’re a high growth company or innovative in any way, you will probably find that most of the criteria will apply to you. You may need to get a letter from your accountant to verify your growth and turnover.

To find out if you are eligible, you will need to visit the SBCI website and fill in the application online. If you are approved for the Brexit Loan Scheme, you can then go to a mainstream bank, such as AIB, Bank of Ireland or Ulster Bank, and they can directly award you with a loan. The loan is guaranteed by Europe, making it very low risk for banks so securing the loan should be a straightforward process.

Have you heard about the Future Growth Loan Scheme?

In the last budget, you may have heard the Future Growth Loan Scheme being discussed. This is the Irish Government’s next step in response to Brexit. It is not released yet, but the scheme is due to make loans ranging between €50,000 to €3,000,000 available this year. The great advantage of this scheme is that instead of the short term loans that SMEs typically get burdened with, the Future Growth Loan Scheme provides loans lasting 8 – 10 years.

This is great news because a big challenge for SMEs that secure a loan is that the restricted terms and conditions of traditional borrowing often hurt a business’s cash flow as you are forced to pay the loan back almost immediately. With the Future Growth Loan Scheme, the risk is greatly reduced, allowing SMEs to make smaller payments over a longer period of time.

Are you eligible for the Future Growth Loan Scheme?

The Future Growth Loan Scheme will be available to Irish SMEs that have an establishment or branch in Ireland including the primary agriculture and seafood sectors. Loans are expected to be used for process and organisational innovation as well as agricultural holdings for primary agricultural production. To apply for the scheme, you will first have to send in your application via SCBI. If you are applying for a loan in excess of €200,000, then you will have to provide a business plan as part of the application process. If you are approved, you will then receive an eligibility reference number. Just like with the Brexit Loan Scheme, you then head to a participating bank and apply for a loan with your reference number. The approval of the loan is subject to the bank’s own credit policies and procedures.

The Brexit Loan Scheme and the Future Growth Loan Scheme are two unique opportunities for Irish SMEs that don’t come around too often. Those in the know are taking advantage of these timely occurrences while they can and if you’re an SME that could do with some financial support or will need finance to support your plans for growth, then we suggest you look into this further. Although no one can be sure exactly what will happen when and if Brexit goes through, you at the very least have the ability to strengthen your position before the time arrives.

If you would like to talk to someone about your company’s financial health and how you can scale up your business, book a free health-check by calling 01 639 2963.

Rory