The disruption that is causing to all businesses is immense, and we therefore welcome the packages and supports offered by Enterprise Ireland to assist larger companies in transitioning through the immediate and critical challenges that COVID-19 inevitably presents.
European Commission approval of additional €200 million financial support package
On 31 March 2020, the European Commission announced its approval of Ireland's €200 million scheme, in line with EU State aid rules, to provide financial support to Irish companies affected by the coronavirus outbreak.
The fund will be administered by Enterprise Ireland as part of a suite of emergency supports to help Irish companies that are seriously and adversely affected by the COVID-19 pandemic. This support will be available to assist companies access the necessary liquidity and funding to sustain their businesses in the short to medium term.
The Scheme will operate as an additional support to the Strategic Banking Corporation of Ireland (SBCI) COVID-19 Working Capital Scheme and supports available from banks and other financial providers.
Strategic Banking Corporation of Ireland (SBCI) Working Capital scheme for eligible businesses impacted by COVID-19
The SBCI COVID-19 Working Capital Scheme loans are available to eligible businesses impacted by the COVID-19 virus resulting in the business turnover/profitability being negatively impacted by a minimum of 15%, and by satisfying a number of innovation criteria.
What are the key loan features?
- loan amounts of between €25,000 to €1.5m per eligible enterprise;
- maximum interest rate of 4%;
- loan terms ranging from one year to three years;
- loans unsecured up to €500,000;
- optional interest-only repayments may be available at the start of the loans; and
- loan amount and term is dependent on the loan purpose.
The loans will be available through AIB, Bank of Ireland and Ulster Bank. Approval of loans are subject to the banks own credit policies and procedures. Businesses cannot complete a loan application until they have received their eligibility letter from the SBCI.
What can the loans be used for?
- Future working capital requirements.
- To fund innovation, change or adaptation of the business to mitigate the impact of COVID-19.
What are the loans not permitted to be used for?
- Refinance of undertakings in financial difficulties.
- Refinance of existing debt (e.g. Terms Loans/Leases/Hire Purchase etc.).
Who can apply?
Viable micro, small and medium sized enterprises (SMEs) and Small MidCap enterprises that meet the following eligibility criteria:
- have fewer than 250 employees;
- have a turnover of €50 million or less (or €43 million or less on their balance sheet);
- are independent and autonomous i.e. not part of a wider group of enterprises;
- have less than 25% of their capital held by public bodies; and
- is established and operating in the Republic of Ireland.
A Small Mid-Cap is an enterprise that is not an SME but has fewer than 500 employees.
Who cannot apply?
SMEs/Small Mid-Caps that:
- are involved in the primary agriculture and/or aquaculture sector;
- are in financial difficulty (excluding cashflow pressures caused by COVID-19 impact);
- are bankrupt or being wound up or having its affairs administered by courts;
- in the last five years has entered in to an arrangement with creditors, in the context of being bankrupt or wound-up or having its affairs administered by the courts; and
- are convicted of an offence concerning professional misconduct by judgement, fraud, corruption, involvement in a criminal organisation, money laundering or any other illegal activity where such illegal activity is detrimental to the European Union’s financial interests.
Other key measures for Enterprise Ireland clients:
Be Prepared Grant for Contingency Planning
The Be Prepared Grant is designed for Enterprise Ireland clients who would benefit from further research and external expertise in examining their exposure to COVID-19 and exploring ways of addressing this. The grant offers up to €5,000 or 50% of the total cost in financial support.
“Finance in focus” grant
The “Finance in focus” grant of up to €7,200 is available to Enterprise Ireland and Údarás na Gaeltachta clients to support financial planning. These consultants will work with businesses to develop a detailed financial and business plan that identifies funding needs and potential sources of funding.
Act On Initiative
The Act On Initiative has been developed to focus on three main areas of capability:
- Financial Management
- Strategic Sourcing
- Transport and Logistics
The initiative helps companies decide on specific actions over a short period to address some of the risks and opportunities from COVID-19. This initiative for Enterprise Ireland clients is delivered at no cost to the company.
Rescue and Restructuring Scheme
A €200m Package for Enterprise Supports including a Rescue and Restructuring Scheme is available through Enterprise Ireland for viable but vulnerable firms that need to restructure or transform their businesses. Details of this package are still being finalised.