COVID-19 - SME Supports

SME Supports during COVID-19

Updated: 12th May

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On the 8th of April, Minister for Business, Enterprise and Innovation, Heather Humphreys TD announced a range of measures to support small and medium enterprises (SME) during the pandemic. These supports extend to all SMEs and include Sole Traders, Partnerships and small limited companies. We have gathered together all of these supports together so you can identify which supports you can qualify for and support your business during these challenging times.

Click the link below to go to the support you'd like to read about or continue scrolling to read them all


Future Growth Loan Scheme

An additional €200m has been made available in COVID-19 funding for the Future Growth Loan Scheme, which will be released in tranches, to provide longer-term loans to COVID-19 impacted businesses. Loan amounts will range €100,000 to a maximum of €3,000,000 per applicant. Loan terms range from 8 to 10 years and loans of up to €500,000 can be unsecured. Interest-only repayments may be available at the start of the loans. The maximum interest rate will be 4.5%.

More information on this scheme can be found here.

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Business Continuity Voucher

The new Business Continuity Voucher, available through Local Enterprise Offices, is designed for businesses across every sector that employ up to 50 people.

The voucher is worth up to €2,500 in third party consultancy costs and can be used by companies and sole traders to develop short-term and long-term strategies to respond to the COVID-19 pandemic.

The goal is to help companies make informed decisions about what immediate measures and remedial actions should be taken, to protect staff and sales.

If your application is successful, a qualified expert will be selected by your Local Enterprise Office to work with you on your business continuity plans. The value of this service is up to a maximum of €2,500.

More information on this service can be found here.


€2,500 Trading Online Voucher Scheme for microenterprises

Businesses with under 10 employees

The Local Enterprise Offices (LEOs) €2,500 Trading Online Voucher is a Government grant scheme, designed to assist small businesses. It offers financial assistance of up to €2,500 along with training and advice to help your business trade online. The Trading Online Voucher grant scheme is administered by the LEOs on behalf of the Department of Communications, Climate Action and Environment. The grant is available to cover 90% of the costs of an online initiative and recipients can be awarded up to two grants of €2,500 to companies which have successfully implemented an initial grant offer. Participating in this scheme can make the process of trading online much easier for businesses.

More information on this scheme can be found here.


Business Financial Planning Grant from Enterprise Ireland

Businesses with over 10 employees

A new support to assist companies planning for the future, a Business Financial Planning Grant is available from Enterprise Ireland to the value of €5,000 to assist companies to develop a Business Sustainment Plan and to engage the services of an approved Financial Consultant.

More information on this scheme can be found here.


LEAN Business Improvement Grant from Enterprise Ireland and IDA Ireland

Businesses with over 10 employees

The Business Process Improvement Grant is used to support short to medium term company projects that are designed to develop management capability and drive company efficiencies and business process improvements. Improvement projects must address a clear business need and deliver a positive impact on your business. Projects must also demonstrate the potential to develop the knowledge and skills of the company's management team.

The Business Process Improvement Grant can be used to support one of the following assignments;

  • Lean Plus Assignment,
  • E-Marketing Improvement Assignment or
  • GreenPlus Assignment.

More information on this grant can be found here.


SBCI COVID-19 Working Capital Loan Scheme

The Strategic Banking Corporation of Ireland (SBCI) COVID-19 Working Capital Scheme is offered in partnership with the Department of Business Enterprise and Innovation, the Department of Agriculture Food and the Marine and is supported by the InnovFin SME Guarantee Facility, with the financial backing of the European Union under Horizon 2020 Financial Instruments.

The loans will be available through AIB, Bank of Ireland and Ulster Bank. Approval of loans are subject to the banks own credit policies and procedures. It should be noted that businesses cannot complete a loan application until they have received their eligibility letter from the SBCI.

Loan Features

  • Loan amounts of between €25,000 to €1.5m per eligible enterprise (see the State Aid section below for further details).
  • Maximum interest rate of 4%.
  • Loan terms ranging from 1 year to 3 years.
  • Loans unsecured up to €500,000.
  • Optional interest-only repayments may be available at the start of the loans.
  • The loan amount and term is dependent on the loan purpose.

Who can apply

Viable micro, small and medium sized enterprises (SMEs) and Small MidCap enterprises that meet the eligibility criteria.

SMEs are defined by the Standard EU definition [Commission Regulation 2003/361/EC] as enterprises that:

  • have fewer than 250 employees
  • have a turnover of €50 million or less (or €43 million or less on their balance sheet)
  • are independent and autonomous i.e. not part of a wider group of enterprises
  • have less than 25% of their capital held by public bodies
  • is established and operating in the Republic of Ireland

A Small Mid-Cap is an enterprise that is not an SME but has fewer than 500 employees.

Who cannot apply

SMEs/ Small Mid-Cap that: –

  • Are involved in the primary agriculture and/or aquaculture sector
  • Are in financial difficulty (excluding cashflow pressures caused by COVID-19 impact)
  • Are bankrupt or being wound up or having its affairs administered by courts
  • In the last 5 years has entered into an arrangement with creditors, in the context of being bankrupt or wound-up or having its affairs administered by the courts
  • Are convicted of an offense concerning professional misconduct by judgement, fraud, corruption, involvement in a criminal organisation, money laundering or any other illegal activity where such illegal activity is detrimental to the European Union’s financial interests.


State Aid

The Scheme operates under the De Minimis State Aid rules.

A State guaranteed loan constitutes De Minimis State Aid. The aid attributable to the Scheme loan facility is calculated individually for each facility, but is typically around 20% of the value of the loan facility.

A guaranteed loan does not preclude a business from obtaining other State Aid in the form of grant funding.

No business may receive more than €200k of De Minimis State Aid, including that arising from the current Scheme application, in any rolling three-year period.

Read more about State Aid on the DBEI website.

Loans can be used for

  • Future working capital requirements.
  • To fund innovation, change or adaptation of the business to mitigate the impact of COVID-19.

Loans cannot be used for

  • Refinance of undertakings in financial difficulties.
  • Refinance of existing debt (e.g. Terms Loans/Leases/Hire Purchase etc.).

Eligibility Criteria

SMEs/Small Mid-Cap must satisfy the COVID-19 Criterion and one of the eleven innovation criteria, detailed below.

COVID-19 Criterion

The business is impacted by the COVID-19 virus resulting in business turnover/profitability being negatively impacted by a minimum of 15%.

Innovation Criteria (Choose one of the following criteria)

Please note that an up to date business plan will be required to be provided to the finance provider(s) in all cases when applying for a loan.

If you select criterion No. 3, 4, 5, 6, 7, 8, 10 or 11 you will also be required to provide the other document detailed in that criterion to the SBCI as part of this application.

  • At least 80% of the Scheme Loan will be spent on research and innovation activities associated with your response to the COVID-19 challenge with the remainder on costs necessary to enable such activities. Evidence required from applicant: The business plan given to the finance provider must reflect the details of the expenditures and activities to be undertaken.
  • You intend to enter a new product or geographical market, and the required investment is higher than 50% of average annual turnover in the preceding 5 years. Evidence required from applicant: The business plan given to the finance provider must reflect details of the expenditures.
  • You will have registered at least one technology right in the last 24 months and the purpose of the loan is to enable use of this technology right. Evidence required from applicant: Evidence of technology right e.g. patent, utility model, design right, protection certificates.
  • You are an SME and research and innovation costs represent at least 10% of total operating costs in at least one of the last three years preceding this application, or in the case where there is no financial history, as per current financial statements. Evidence required from applicant: Costs to be certified by an accountant practising in the Republic of Ireland.
  • You are a Small Mid-Cap and research and innovation costs represent either: -
    1. at least 15% of total operating costs in at least one of the three years preceding this application.
    2. at least 10% per year of total operating costs in the three years preceding this application.
    Evidence required from applicant: Costs to be certified by an accountant practising in Republic of Ireland.
  • You have been awarded a Research and Development or Innovation prize by an EU Institution or EU Body over the last 24 months.
  • Evidence required from applicant: Appropriate evidence of prize.
  • You have received a grant, loan or guarantee from a European research and innovation scheme (e.g. Horizon 2020 or FP7) or regional/national research or innovation support scheme in the last three years, and are confirming that the loan is not covering the same expense. Evidence required from applicant: Appropriate evidence of the grant, loan or guarantee.
  • You are an early stage SME and have received an investment over the last 24 months from a venture capital investor or business angel. Evidence required from applicant: Appropriate evidence of the investment to be provided.
  • You intend to use the loan to invest in producing, developing or implementing new or substantially improved products, processes or services or production or delivery methods (including business models) that are innovative, and where there is a risk of technological, industrial or business failure as evidenced by an external expert. Evidence required from applicant: The business plan must demonstrate those risks of failure and evaluated by an external expert e.g. an accountant, engineer, the finance provider.
  • You are a “fast growing enterprise” operating for less than 12 years with an average annualised employee or turnover growth greater than 20% a year, over a three-year period and with ten or more employees at the beginning of that period. Evidence required from applicant: Evidence to be certified by an accountant practising in Republic of Ireland.
  • You are operating in a market for less than seven years and research and innovation costs represent at least 5% of total operating costs in at least one of the three years preceding the loan application or in the case of an enterprise (and particularly a startup) without any financial history, according to current financial statements. Evidence required from applicant: Costs to be certified by an accountant practicing in Republic of Ireland.

SME/ Small Mid-Cap must first complete the Eligibility Application Form to check if they are eligible to apply to the bank(s) for a loan under the Scheme.

If an SME/ Small Mid-Cap is eligible they will receive a letter of confirmation from the SBCI which they then present to the bank(s), as part of the credit application process.


Microfinance Ireland COVID-19 Business Loan

Businesses with under 10 employees

The COVID-19 Business Loan from Microfinance Ireland is a government initiative to support small businesses (Sole Trader, Partnership or Limited Company) through the current period of uncertainty and protect job creation or sustainment in Ireland.

If your business is impacted or may be impacted by COVID-19 resulting in a reduction of 15% or more in actual or projected turnover or profit, AND you are having difficulty in accessing finance from commercial lending providers, the MFI COVID-19 Business Loan may be able to help your business.

In addition, Local Enterprise Offices in every county provide a range of business supports for micro-enterprises including business continuity and preparedness advisory supports connected to the COVID-19 outbreak.

Loan Features

  • Loans from €5,000 – €50,000
  • Supports businesses who have been impacted negatively by coronavirus in Ireland
  • Loan terms typically up to 3 years
  • First 6 months – 0% Interest & Zero repayments
  • Reduced interest rate 4.5% APR for LEO/Local Development Committee applications and 5.5% APR for Direct applications
  • No fees/no hidden charges
  • Fixed repayments/no penalty for early repayment

Who can apply?

  • Any microenterprise (Sole Trader, Partnership or Limited Company) who is currently trading
  • not in a position to avail of Bank finance and
  • is experiencing a COVID-19 negative impact on their business (The negative impact must be a minimum of 15% of actual or projected in turnover or profit).

What is a microenterprise?

A micro-enterprise is a business with:

  • fewer than 10 full-time employees
  • less than €2m annual turnover and
  • a Balance Sheet with Net Worth/Capital Account/Equity that does not exceed €2m.

What are the eligibility criteria?

In order to apply for finance up to €50,000, the business must provide a declaration to Microfinance Ireland that they meet the following eligibility criteria:

  • A minimum of 15% of actual or projected turnover or profit in the business is negatively impacted by COVID-19
  • The business is a micro-enterprise
  • The business is having difficulty in accessing finance from Banks and/or other commercial lending providers.

Documents required to apply

  • Application Form (Template available at microfinanceIreland.ie)
  • COVID-19 Business Plan (Template available at microfinanceIreland.ie)
  • Cashflow Forecast (Template available at microfinanceIreland.ie)
  • 6 Months Bank Statements
  • Central Credit Register Report (CCR) - For limited companies a personal credit report from CCR is required for all shareholders and / or Directors with a 25% or shareholding the Company.

In addition, for loans > €25,000

  • The business is having difficulty in accessing finance from Banks and/or other commercial lending providers.

How to apply

Talk to a Business Advisor in your Local Enterprise Office

or

Register at microfinanceIreland.ie)

or

Talk to a Microfinance Ireland advisor on 01 260 1007.

What if I am an existing MFI loan customer?

For businesses with an existing loan with Microfinance Ireland and the business is either currently impacted or may be impacted by COVID-19, please contact MFI to discuss the situation so that we can help you in getting your business back on track.

More information is available on microfinanceireland.ie/loan-packages/covid19.


Enterprise Ireland - Sustaining Enterprise Fund

Businesses with over 10 employees

Enterprise Ireland has a new fund to provide manufacturing and internationally traded services companies with capital to help stabilise and rebuild their businesses.

The purpose of the fund is to sustain companies who have been impacted by a 15% or greater reduction in actual or projected turnover or profit, and/or have significant increase in costs as a result of the COVID-19 outbreak.

To deliver on this, the objectives of the fund are to:

  • Ensure eligible companies have access to necessary liquidity in the short-term; and
  • Sustain the business so that the company can return to viability and contribute to the recovery of the Irish economy.

Loan Features

  • Funding of up to €800,000 available;
  • Funding will be in the form of repayable advances or equity investment;
  • Funding to be repaid subject to the project objectives being achieved;
  • An annual administration fee of 4%.

The advance payment to be repaid as follows:

  • 3-year grace period;
  • Repayment by the end of year 5, on successful achievement of the project objective.

What are the eligibility criteria?

Businesses will be required to submit a Business Sustainment Plan as part of their application for funding. The Sustaining Enterprise Project Plan should set out, if implemented, that it can lead to a stabilisation of the business and a return to viability.

The Business Sustainment Plan must identify the extent of the immediate liquidity needs and outline how support provided through the proposed measures will remedy the company’s immediate problems.

Eligible businesses must have seen a negative impact arising from the COVID-19 outbreak and also have seen (or expect to see) a 15% or greater reduction in actual or projected turnover or profit, or a significant increase in costs, as a result of COVID-19.

Who cannot apply?

This scheme is not open to companies that were:

  • In financial difficulty on 31st of December 2019 (within the meaning of the General Block Exemption Regulation)
  • That are active in the primary agricultural, fishery or aquaculture sectors;
  • That operate in the coal and steel sector;
  • Covered by specific rules for Financial Services.

Documents required to apply

In order to apply for the Sustaining Enterprise Fund, eligible companies will need to provide:

  • A Business Sustainment Plan which details the business project plan, which if fully implemented, will enable the company to be financially viable
  • Evidence of application for funding through the SBCI or financial institutions
  • Evidence of the need for COVID-19 support funding
  • Identification of the sources of additional funding required to fully implement the business project plan
  • Evidence of a drop of 15% or more (or projected) in income arising from the COVID-19 situation.

How to apply / Further information

For further information, contact your Development Adviser or visit the Sustaining Enterprise Fund webpage.


SME Credit Guarantee Scheme

The purpose of the SME Credit Guarantee Scheme is to encourage additional lending to SMEs (micro, small and medium sized enterprises) by offering a partial Government guarantee (currently 80%) to banks against losses on qualifying loans to eligible SMEs. The Credit Guarantee Scheme does not substitute for conventional lending that would otherwise have taken place.

To help SMEs impacted by COVID-19 related issues to have access to sufficient working capital, the government has repurposed the Credit Guarantee Scheme (CGS) to provide counter guarantees to the banks, mitigating credit risk or need for collateral.

The Credit Guarantee Scheme can be used by businesses to obtain loans to support changes they need to make to their business in response to COVID-19.

The Scheme is targeted towards companies who are unable to access credit because of three distinct barriers to lending;

  • Inadequate collateral
  • Novel business market, sector or technology which is perceived by lenders as higher risk under current credit risk evaluation practices
  • Need for refinancing caused by the exit of an SMEs lender from the Irish market

Loan Features

  • Facilities of €10,000 up to €1m
  • Terms of up to 7 years
  • Term Loans, Demand Loans and Performance Bonds
  • You may be able to avail of between a three to six-month interest-only payment period (depending on the total loan duration)
  • The Scheme is operated on behalf of the Department by the Strategic Banking Corporation of Ireland (SBCI) and is available from the participating lenders (AIB, Bank of Ireland and Ulster Bank).

Who can apply?

Viable micro, small and medium sized enterprises (SMEs).

Who cannot apply?

SMEs that:

  • Are involved in the primary agriculture, horticulture and fisheries are excluded from the scope of the scheme in the light of particular restrictions under the De Minimis State Aid rules. Note the food and drinks sectors will be eligible for the Scheme.
  • Are in financial difficulty (excluding cashflow pressures caused by COVID-19 virus impact)
  • Are bankrupt or being wound up or having its affairs administered by courts.
  • In the last 5 years has entered in to an arrangement with creditors, in the context of being bankrupt or wound-up or having its affairs administered by the courts.
  • Are convicted of an offense concerning professional misconduct by judgement, fraud, corruption, involvement in a criminal organisation, money laundering or any other illegal activity where such illegal activity is detrimental to the European Union’s financial interests

What is an SME?

SMEs are defined by the Standard EU definition [Commission Regulation 2003/361/EC] as enterprises that:

  • have fewer than 250 employees
  • have a turnover of €50 million or less (or €43 million or less on their balance sheet)
  • are independent and autonomous i.e. not part of a wider group of enterprises
  • have less than 25% of their capital held by public bodies
  • is established and operating in the Republic of Ireland
  • A Small Mid-Cap is an enterprise that is not an SME but has fewer than 500 employees

What is the interest rate on these loans?

The interest rate charged on the loan will be the banks SME lending rates. In addition, the borrower pays a premium that partially covers the cost of providing the guarantee. The premium can vary but is currently 0.5%. The premium is collected annually or quarterly in throughout the life of the guarantee (max. 7 years) based on loan balance.


State Aid

The Scheme operates under the De Minimis State Aid rules.

A State guaranteed loan constitutes De Minimis State Aid. The aid attributable to the Scheme loan facility is calculated individually for each facility, but is typically around 20% of the value of the loan facility.

A guaranteed loan does not preclude a business from obtaining other State Aid in the form of grant funding.

No business may receive more than €200k of De Minimis State Aid, including that arising from the current Scheme application, in any rolling three-year period.

Read more about State Aid on the DBEI website.

How to apply

Businesses seeking to avail of the guarantee scheme can approach a participating lender. Participating lenders will make all decisions on lending. Currently, Ulster Bank, Bank of Ireland and AIB are participating in the Scheme.

The Department plays no role in the application or decision-making process, which, is fully delegated to the participating lenders.

The lender assesses viability, that is, whether the business will be able to make the necessary repayments on the credit, according to its normal assessment criteria and the decision of the lender in terms of assessing viability is final. The baseline for determining commercial viability within the Scheme should be no different from the standard viability test applied by each lender within their normal commercial SME lending procedures.

There is no automatic entitlement to receive a guaranteed facility even if a business believes it satisfies the basic eligibility criteria. The normal redress processes are available to declined businesses.

For further information visit the Department of Business, Innovation and Enterprise.


MABS is open and money advisers are available to take your money advice queries by phone and email.

You can contact your local MABS office or call the MABS Helpline on 0761 07 2000, Monday to Friday, from 9am to 8pm or you can check the MABS website for further updates and guidance.

Follow @MABSinfo on Twitter and Facebook and Instagram for further updates.


Originally posted: 20th April 2020