DUBLIN, Ireland - The Irish government is to inject significant funds into businesses in the form of low cost loans to assist in them staying in business, and transitioning to an improved economy.
The new COVID-19 Credit Guarantee Scheme (CGS) will now be complemented by the Credit Guarantee (Amendment) Bill 2020, which will underpin the scheme and will also remove the portfolio cap.
This will result in an increased potential maximum liability of €1.6 billion.
The scheme will be the largest credit guarantee scheme for businesses in the history of Ireland. It will ensure that SMEs, primary producers and small Mid-Caps can access liquidity to keep their businesses operating, as the economy continues to reopen and more and more people get back to work. It will be available for a wide range of products including overdrafts, term loans and working capital.
The legislation is expected to go through the Oireachtas next week, allowing for a swift enactment. As with other credit guarantee schemes, the COVID-19 CGS will be operated by the Strategic Banking Corporation of Ireland and will be available through three banks; AIB, Bank of Ireland and Ulster Bank.
"We want to help viable businesses to get through the difficult phase of reopening and deal with the new realities and challenges posed by COVID-19. The Credit Guarantee Scheme will provide low cost loans to businesses and will in turn help more people to get back to work," the Tnaiste and Minister for Enterprise, Trade and Employment Leo Varadkar said Tuesday.
"The changes being made to this Scheme will bring our offering into line with similar schemes across Europe. We want to give confidence to SMEs in particular, by providing the liquidity needed to get through the economic upheaval caused by the pandemic. This Scheme complements the other actions taken to date by Government, including direct grants to businesses, the warehousing of tax liabilities and commercial rates waivers. The July Stimulus Package will be the next step in our recovery plan as we seek to get businesses back on their feet and our people back to work."