It was announced today that Microfinance Ireland (MFI), the government funded micro-business lender, is now open for applications for loans up to €25,000.
The new funds aim to support microenterprises through the current period of uncertainty and to protect jobs in small businesses that have been impacted by the coronavirus pandemic in Ireland.
Following unprecedented demand from micro-businesses the initial COVID19 Microfinance Ireland Loan was fully subscribed by July. Prior to suspending the fund MFI supported 687 businesses with circa €20m in loans approved.
In addition, MFI also supported 760 of its existing customers with loan moratoriums and loan restructures. These loans supported a broad range of businesses across all sectors during the early phase of the pandemic.
Key features of new scheme:
• Maximum loan value €25,000, 3-year term
• Zero repayments and zero interest for first six months
• Repayments commence in month 7
• Interest paid in months 7-12 refunded by Government in month 13, once all repayments in those 6 months are paid in full (giving 12 months interest free). • • Refunds go directly to business working account
• Interest rate 4.5% (applications made through Local Enterprise Office or other referral partners) or 5.5% fixed APR for applications made directly to MFI, from month seven to the end period of the loan.
Commenting on the initiative, CEO of Microfinance Ireland, Garrett Stokes said, "We are delighted to be in receipt of additional government funding enabling us to reopen for applications from 31st August onwards. Since March, demand for MFI loans, particularly the COVID19 loans, has exceeded all expectations, resulting in all funds being fully subscribed some weeks ago."
He added, "We can see where the demand is coming from most and our new COVID-19 Loan Scheme has been tailored to meet the ongoing needs of those micro-businesses as they navigate their way through the current challenges and beyond."