Éamon Ó Cuív (Galway West, Fianna Fail)
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330. To ask the Minister for Finance if it is intended to release further funding to the Strategic Bank Corporation of Ireland to further aid the development of suitable projects; if so, when a decision will be made on same; and if he will make a statement on the matter. [1191/23]

Michael McGrath (Cork South Central, Fianna Fail)
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The Strategic Banking Corporation of Ireland (SBCI) began lending in March 2015. By the end of June 2022, the SBCI had supported lending of €3.2 billion to more than 50,000 SMEs, from all sectors of the Irish economy and across a wide geographical spread, utilising a mix of low cost liquidity and guarantees.

The SBCI has a number of schemes launched and in development to help release further funding for suitable projects.

These include the Growth and Sustainability Loan Scheme, the Energy Efficiency Loan Scheme, the Ukraine Credit Guarantee Scheme and the Retrofit Scheme.

Growth and Sustainability Loan Scheme

On 9 November 2022, Government approved the establishment of a €500 million Growth and Sustainability Loan Scheme. This Scheme will be a successor scheme to the Future Growth Loan Scheme (FGLS), as a longer-term loan guarantee scheme to enable investment.

The FGLS scheme is fully subscribed and new applications are no longer being accepted.  An independent review of that scheme provided strong evidence of positive economic benefits for many SMEs that accessed finance through that scheme, including increases in employment and turnover. The review of the FGLS also confirmed that there is continued demand by SMEs for appropriate longer-term external finance for investment purposes.

Similar to its predecessor scheme, the Growth and Sustainability Loan Scheme will provide for loans ranging from €25,000 to €3 million; for terms of 7 to 10 years.  Loans of up to €500,000 can be unsecured. The Growth and Sustainability Loan Scheme will be available to SME’s, including farmers and fishers, with maximum loans to mid-caps limited to €937,500 due to De Minimis State Aid restrictions.

Under the scheme, 70% of the lending volume will be provided for investment in business growth and sustainability, while a minimum of 30% of lending volume will be directed to investment in environmental sustainability. The SBCI will deliver the scheme on behalf of the Minister for Enterprise, Trade and Employment and the Minister for Agriculture, Food and the Marine. This scheme will be underpinned by a counter-guarantee from the European Investment Fund/European Investment Bank Group (EIF/EIBG). It is anticipated that this scheme will launch in Q2 2023.

Energy Efficiency Loan Scheme

The Energy Efficiency Loan Scheme (EELS), launched in July 2022, is a 10-year loan guarantee scheme focused on improving businesses’ sustainability and increasing investments in energy efficiency measures, including heat pumps, solar panels, LED lightning and other energy-saving technology.

This scheme is designed to help SMEs, farmers and fishers reduce their energy costs and transition to more sustainable business models. Borrowers can benefit from reduced interest rates, as low as 4%, and finance amounts ranging from €10,000 to €150,000 over terms of up to 10 years.

Ukraine Credit Guarantee Scheme

In recent years, a number of State-backed guarantee schemes have been developed to support SMEs impacted by Brexit and Covid-19 and delivered through the SBCI. The S.I. in relation to the Ukraine Credit Guarantee Scheme (UCGS) was signed on 08 December 2022 to unlock up to €1.2 billion of low-cost, unsecured working capital for SMEs, small Mid-Caps, and primary producers affected by the Ukraine crisis.

In order to qualify for the scheme, the borrower will have to declare that costs have increased by a minimum of 10% on their 2020 figures and that the loan is being sought specifically as a result on difficulties being experienced due to the Ukraine crisis. Loan facilities ranging from €10,000 to €1 million will be available. Loans of up to €250,000 can be unsecured, which can be used for overdrafts, working capital and term loan facilities.

Retrofit Scheme

A residential retrofit loan guarantee scheme for homeowners and small landlords is currently being developed by the SBCI on behalf of the Department of Environment, Climate and Communications. The scheme has a proposed lending capacity of €500 million.