The Irish Government is set to open the microfinance scheme from next Monday for businesses and sole traders that employ 10 people or less that have been refused credit by the banks. Via the fund, businesses will be able to apply for loans of up to €25,000.
The Government is anticipating the scheme will provide more than €90m in extra lending to 5,500 businesses and create an additional 7,700 jobs over 10 years.
The microfinance scheme will initially have €40m in lending over the next five years for businesses that employ 10 people or less. Following that, there will then be the provision for the scheme to be extended to provide an additional €50m of lending over a further five years.
Start-ups, sole traders and existing microenterprises will be eligible to apply for a loan under the scheme. In June, the Government indicated it expected the average loan to be €16,000.
For businesses to be eligible for the scheme, a request for credit must first have been declined by the banks.
The Minister for Jobs, Enterprise and Innovation Richard Bruton, TD, announced the scheme this morning at Dux & Co, a catering business that was set up two years ago. Having been refused credit from the banks, Dux & Co availed of microfinance lending and has recently opened a café on Wellington Quay in Dublin. The business now employs eight people.
“The Government is acting to ensure that a much wider range of businesses who are refused credit by the banks have access to microfinance lending,” said Bruton.
The scheme itself will be operated by Microfinance Ireland, a subsidiary of the Social Finance Foundation.
Those interested in applying for the scheme can get application forms from the county and city enterprise boards.