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New €15m COVID-19 loan scheme launched for micro businesses

Microfinance Ireland has launched a €15m COVID-19 fund to help ‘micro-enterprises’ impacted by the pandemic and protect jobs.

The government-funded micro-business lender is offering loans of €5,000 to €25,000 to sole traders, partnerships and limited companies with fewer than 10 employees and annual turnover of less than €2m.

It is the second such programme of loans offered by MFI following the initial COVID-19 Microfinance Loan scheme, which approved €18.6m in total loans to 683 businesses.

Microfinance Ireland has launched a loan scheme worth €20m.  Click here for further information.

The scheme is designed to help very small businesses to pay for stock, meet working capital requirements and other overhead expenses during the COVID-19 uncertainty.

‘Since March, demand for MFI loans, particularly the COVID-19 loans, has exceeded all expectations, resulting in all funds being fully subscribed some weeks ago,’ Microfinance Ireland CEO Garrett Stokes said.

‘We can see where the demand is coming from most and our new COVID-19 Loan Scheme has been tailored to meet the ongoing needs of those micro-businesses as they navigate their way through the current challenges and beyond.’

Leo Varakdar said the loan have provided a lifeline to micro businesses over the past few months. Pic: Maxwells

Minister for Enterprise, Trade and Employment Leo Varadkar said: ‘This fund has proven to be a lifeline for micro-enterprises over the past few months, where we’ve seen nearly 700 businesses with fewer than ten employees avail of it.

‘We’ve set out a really significant financial package in the July Stimulus and this loan scheme is another way we’re helping businesses to re-open, stay afloat or expand.’

  • Loans are repayable over a maximum term of three years, with no repayments made and 0% interest made for the first six months.
  • The scheme is available to sole traders and companies with fewer than 10 people.
  • Interest paid, at a rate of 4.5% for applications made through the Local Enterprise Office or 5.5% for applications made directly through MFI, in the second six months is refunded in full by the government.