Gary Gannon (Dublin Central, Social Democrats)
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484. To ask the Minister for Jobs, Enterprise and Innovation her views on the reluctance of banks to loan to SMEs in order for them to commence the process of reopening their businesses in accordance with social distancing guidelines; and the grants that will be made available to the hospitality sector to ensure the industry can maintain itself as the Covid-19 crisis abates while the economic conditions remain precarious. [8226/20]

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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The Government has worked to put in place a suite of supports to encourage lending through the banks to SMEs, the following supports are available to all eligible business, including the hospitality sector.

The Covid-19 Working Capital Scheme and the Future Growth Loan Scheme both leverage counter-guarantees through the European Investment Bank to provide a significant guarantee to banks on loans to eligible businesses, reducing the risk associated with such lending. On 8 April I announced significant expansions to both schemes.

On 2 May, I announced a new €2bn Covid-19 Credit Guarantee Scheme. This Scheme forms a major component of the government’s strategy to aid SMEs in these difficult times by providing critical support to ensure businesses are facilitated in having access to credit facilities to assist a return to a more regular trading environment. It will provide an 80% guarantee on lending to SMEs until the end of this year. The guarantee can be used for a wide range of lending products between €10,000 and €1 million that have a maximum term of six years. The guarantee structure will reduce the risk exposure to the bank and open up lending which banks may otherwise have considered to be too high a risk.

The Pillar Banks have assured me that they will support businesses through the Covid-19 Crisis, and I continue to meet with them regularly to make sure they are delivering as such. The banks have had to deal with an overwhelming increase in activity since the outbreak of the COVID-19 crisis and this may have caused some delays in dealing with new business loans leading to a perceived reluctance to lend. While the State supported loan guarantee schemes provide risk coverage to the banks, banks do have an obligation to undertake credit assessment of the loans applied for according to their own policy and procedures. In these uncertain times, this poses many complexities.

I must highlight also that for micro-enterprises that have not achieved lending through the banks, application for a loan through Micro Finance Ireland could be considered. Microenterprises can access COVID-19 Business Loans of up to €50,000 from Microfinance Ireland. The terms include a six months interest free and repayment free moratorium, with the loan to then be repaid over the remaining 30 months of the 36-month loan period.

In addition, the newly launched €250m Restart Grant allows for direct grant aid to micro and small businesses of between €2,000 and €10,000. Application forms now available online on all local authority websites. The grant is a contribution towards the cost of re-opening or keeping a business operational and re-connecting with employees and customers.

To qualify for the Restart Grant, a business must

- have a turnover of less than €5m and have 50 or less employees.

- have suffered a projected 25%+ loss in revenue from 1^stApril 2020 to 30th June 2020.

- commit to remain open or to reopen if it was closed. The business must also declare the intention to retain employees that are benefitting from the Temporary Wage Subsidy Scheme (TWSS).

The COVID-19 outbreak will result in a serious downturn in the Irish, EU and wider global economy. To assist companies to respond to these challenges, and in doing so stabilise and rebuild their business, Enterprise Ireland, on behalf of the Department of Business Enterprise and Innovation has launched a new suite of COVID-19 supports; these are:

Sustaining Enterprise Fund -This €180 million fund will provide support to eligible manufacturing and internationally traded services companies employing 10 or more employees who have been impacted by a 15 per cent or more reduction in actual or projected turnover or profit, and/or have a significant increase in costs as a result of the COVID-19 outbreak. The objectives of the scheme are to:

- Ensure eligible companies have access to the necessary liquidity; and

- Sustain business so that companies can return to viability and contribute to the recovery of the Irish economy.

The Fund will provide financial assistance in the form of repayable advances of up to a maximum of €800,000 per company.

Sustaining Enterprise Fund – Small Enterprise:This fund will provide a €25k to €50k short term working capital injection to eligible smaller companies to support business continuity and strengthen their ability to return to growth and be trading strongly in 3 years’ time.

A NEW HPSU fund to Sustain Enterprises:This fund is aimed at EI High Potential Start-Up companies who, due to the Covid-19 pandemic are facing delays to projected sales growth and whose fundraising plans are significantly impacted or stalled. Under this fund, HPSUs can apply for co-investment of €50,000per undertaking in the form of equity or convertible debt instruments.

In addition to this fund Enterprise Ireland has launched the following supports:

- Covid-19 Business Financial Planning Grant: A €5k grant for eligible companies to work with third party consultants to prepare a detailed financial plan with forecasts and assumptions. 337 applications have been received for Covid-19 Business Financial Planning Grant.

- Lean Business Continuity Voucher: A €2.5k voucher for eligible companies to access training or advisory services support related to the continued operation of their business during the current pandemic. 156 applications have been received for the LEAN Business Continuity Voucher.

- Covid-19 Online Retail Schemeis a grant for retail companies with greater than 10 employees to develop a more competitive online offer. This competitive call has a budget of €2 million. Successful applicants will receive funding support of up to 80% of project costs, with a maximum grant of €40,000.

A wide range of financial supports and guidance has been made available by my Department and wider Government to help businesses impacted by the COVID-19 crisis. Full details of all supports and guidance is available at

It is important to check for the latest information, public health advice and guidelines from Government in relation to Covid-19.