There has been just 656 applications under the Brexit Loan Scheme which were established by Government to support small and medium-sized businesses in this country.
The €300 million Brexit Loan Scheme provides relatively short-term working capital of one to three years for eligible businesses with up to 499 employees to help them to innovate, change or adapt to mitigate their Brexit challenges.
Businesses can confirm their eligibility with the Strategic Banking Corporation of Ireland (SBCI) and, if deemed eligible, can apply to one of the participating finance providers for a loan under the scheme.
Meanwhile, news of the number of applications thus far emerged during Dáil proceedings last week after deputy Billy Kelleher highlighted the matter “given the potential impact the UK’s leaving the EU could have on companies in this country”.
He then asked that if a hard Brexit was in store why had only 10% of the overall funding – under the scheme – been made available?
These are loans that must be repaid but I worry that there have only been 656 applications out of the huge total of small and medium-sized businesses.
Kelleher continued: “I accept that not everybody will be impacted upon as directly by Brexit as others, but is it a cumbersome programme? Is there too much red tape and bureaucracy?
“These issues must be analysed in advance. We now know that companies are going through an application process, but we also know that only 10% of the overall funding available has been loan sanctioned.
“I urge the minister to undertake a quick review and audit of the scheme to ensure that, if it is cumbersome and there is a lot of red tape, or if businesses are discouraged from making an application in the first place, these issues will be addressed now rather than after the event.”
Sanction and draw-down
Meanwhile, in response to the deputy, Heather Humphreys – Minister for Business, Enterprise, and Innovation – said that in terms of the number of applicants for the Brexit Loan Scheme, the latest data available to her indicated that, at close of business on June 21, 656 eligibility applications were received by the SBCI – of which 596 were deemed eligible by it.
Of the 596 eligible applicants 144 have progressed to sanction with their banks.
She continued: “The value of the sanctioned loans from banks on June 21 was €31.73 million. While data for actual funding received by applicants as of June 21 is not available, we know that there is a high conversion from sanctioned loans to draw-down.
“SBCI data for the end of March indicates that 88% of the total value of loans sanctioned by banks had been drawn down by businesses.”