Richard Bruton (Dublin North Central, Fine Gael) | Oireachtas source

My Department has introduced a range of targeted initiatives to support an additional flow of credit into the economy by filling gaps where specific market failures exist. The credit guarantee scheme and the microenterprise loan fund are among those initiatives.

The credit guarantee scheme has been live since 24 October and is intended to address market failure affecting commercially viable businesses. It provides a 75% State guarantee to banks against losses on qualifying loans to firms with growth and job creation potential.

A total of €299,981, including VAT, has been paid to the operator of the scheme. The cost of the scheme will be partially offset by receipts from the 2% premium paid by borrowers. To date, loans of over €3 million have been issued under the scheme, as a result of which over 200 jobs are expected to be created or maintained.

The second initiative is the microenterprise loan fund which was established by Government and began operating at the beginning of October to improve access to credit for entrepreneurs and micro-enterprises and to facilitate the growth and expansion of viable businesses.

The State provided a grant of €10 million in 2012 to Microfinance Ireland, the company established to administer this scheme. I can report that the cost for 2012 was €461,000, which includes once-off set up costs of €278,000. To date, applications of over €2.5 million have been made under the scheme and €700,000 has been approved, as a result of which over 110,000 jobs are expected to be created or maintained.

In relation to the cost of both schemes, Exchequer gains in terms of employment sustained and created, savings on welfare payments and increased direct and indirect taxes have been calculated at over €20,000 per job. On this basis I am satisfied that both schemes are more than balanced by the potential benefits.

In addition to these initiatives, the seed and venture capital scheme, the Innovation Fund Ireland and the development capital scheme are helping Irish companies, including SMEs, access funding in the current difficult environment.

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