2nd October 2019
With 29 days to go until Brexit, the Minister for Business, Enterprise and Innovation, Heather Humphreys TD, today urged businesses to secure approval for the Government’s €300 million Brexit Loan Scheme now, in advance of October 31st, to be ready for the aftermath of a potential No Deal scenario.
The Scheme is designed to address working capital challenges brought about by Brexit. Loans of up to €1.5 million are available at a rate of 4% or less, with loans of up to €500,000 available on an unsecured basis. Loan eligibility remains valid for 4 months.
Minister Humphreys said:
The most immediate consequences of a hard Brexit are likely to be currency movements, supply chain constraints, delays, duties and tariffs. In the first instance, this will put a strain on the working capital position of businesses, so now is the time to put your safety nets in place.
We don’t know what the lay of the land will be like after 31st October. If there is a crash-out Brexit, we could see a sudden rush of applications. As a result, my strong advice is to apply for the Scheme now as a contingency measure.
Look at it as an insurance policy. If you apply now and get approval there is no obligation to ever draw down the loan. Ultimately, it’s up to you whether or not you proceed, so my strong advice is to apply now and decide later.
The eligibility stays valid for 4 months and it can give you financial certainty in a very unpredictable situation. You could be very relieved to have the option there in a few weeks’ time.”
The Minister also drew businesses’ attention to the Future Growth Loan Scheme, which makes an additional €300 million available to support strategic investment by SMEs in a post-Brexit environment. These loans are open to those in the primary agriculture and seafood sectors.
Both Loan Schemes are administered for the Government by the Strategic Banking Corporation of Ireland and delivered through the banks.
Pointing to the Future Growth Loan Scheme, the Minister said:
Up until recently, finance of more than 7 years was not available on the market. Through the Future Growth Loan Scheme, the Government is addressing this gap by providing loans with terms of 8 to 10 years to Irish SMEs and farmers.
Eligibility for this Scheme remains valid for 6 months so, again, I would urge firms to put it in place now so that they have the option there at a later stage.”
In addition, the Minister reminded companies that Enterprise Ireland administers both the Be Prepared Grant, offering up to €5,000 to assist exporting client companies to develop a Brexit plan, and the Market Discovery Fund, which supports companies to research viable and sustainable new market entry strategies.
She also stressed that the Local Enterprise Offices operate the TAME grant, which offers up to €2,500 to support companies to explore and develop new export market opportunities, while InterTradeIreland’s Start to Plan vouchers provide up to €2,250 for SMEs to source professional advice or training. Businesses can also avail of up to €5,625 though the Brexit Implementation Voucher to support implementation of their contingency plan.
The Minister concluded:
I fully accept that that the lack of clarity complicates our Brexit contingency planning. I also accept that it is incredibly difficult for businesses – especially small businesses – to plan for a situation that remains so unclear. Notwithstanding this, there are certain steps you can take immediately to strengthen your financial position, so I am appealing to you to act now to help protect your business and employees.”
Notes to the Editor
About the Brexit Loan Scheme
The Brexit Loan Scheme, which was launched in March 2018 provides affordable financing to businesses that are either currently impacted by Brexit or will be in the future. The Scheme is delivered by the Strategic Banking Corporation of Ireland (SBCI) through Bank of Ireland, Ulster Bank and AIB makes €300 million available to eligible businesses with up to 499 employees at an interest rate of 4% or less.
- Loan amount from €25,000 up to a maximum of €1,500,000
- Loan term of up to 3 years
- Loans less than €500,000 will be unsecured
- Interest rate of 4% or less.
Loans can be used for:
- Future working capital requirements to fund innovation, change or adaption the business to mitigate the impact of Brexit.
About the Future Growth Loan Scheme
The Future Growth Loan Scheme, which was launched in March 2019 provides affordable financing to Irish businesses and the primary agriculture and seafood sectors to support strategic long-term investment in a post Brexit environment. The Scheme, which is delivered by the Strategic Banking Corporation of Ireland (SBCI) through Bank of Ireland, Ulster Bank, KBC and AIB makes €300 million available to eligible businesses with up to 249 employees at an interest rate of 4.5% or less for loans up to €249,999 and 3.5% and less for loans greater than or equal to €250,000.
- Loan amount from €100,000 (€50,000 for primary agriculture) up to a maximum of €3,000,000
- Loan term from a minimum of 8 years to a maximum of 10 years
- Loans less than €500,000 will be unsecured
- Interest rate of 4.5% for loans up to €249,999 and 3.5% and less for loans greater than or equal to €250,000.
Loans can be used for:
- Investment in tangible or intangible assets for the purpose of process and organisational innovation.
- Investment in tangible and intangible assets on agricultural holdings linked to primary agricultural production.
About the Government’s online Guide Getting Your Business Brexit Ready – Practical Steps
As part of the Government’s ongoing activity to help businesses and consumers to prepare for Brexit, a new campaign has been launched highlighting the practical steps all businesses – large and small – should take NOW to prepare for the UK’s departure from the EU.
- Understand the new rules for UK importing and exporting
- Review your supply chain and UK market strategy
- Be aware of possible changes to transport and logistics
- Review all your certification, regulation and licencing
- Review your contracts and data management
- Ensure you are maximising Government Brexit programmes and supports
- Manage your cash flow, currency and make sure your banking is in order
- Protect and inform your staff
- Know more about the impact to your sector.
The user-friendly booklet is available here: Getting Your Business Brexit Ready – Practical Steps
Recent actions by Government to prepare the economy for a No Deal Brexit
Work has continued across all sectors to further strengthen and refine preparations for no deal Brexit in the lead up to 31 October.
Additional physical capacity is in place at ports and airports to apply checks and controls, in a no deal scenario. The focus over between now and 31 October will be to refine and improve the available infrastructure.
Revenue, the Department of Agriculture, Food and the Marine, and the Department of Health have recruited and trained additional staff who will be required in any Brexit scenario. Recruitment and training of further additional staff can be accelerated in a no deal scenario.
Since July 2019, Revenue have written individualised letters to all 92,000 businesses who traded with the UK in 2019. Additional follow up telephone contact is being made with approx. 42,000 businesses who have trade volumes of over €5,000 with the UK, or who trade with the UK at least quarterly.
A large-scale campaign to inform citizens about the impact of Brexit on them is currently underway. This builds on the Brexit and You campaign which was run earlier in the year. A campaign aimed directly at businesses recently took place focussing on the Getting Your Business Brexit Ready – Practical Steps.
Clear Customs Initiative
The Government launched on 7 August a new support measure to help Irish businesses develop the capacity to deal with the additional customs requirements due to the UK’s departure from the EU, particularly under a “No Deal” scenario.
“Clear Customs” has been designed by industry for industry as they prepare for the new customs requirements post-Brexit. The initiative, which is being made available to eligible businesses and customs intermediaries free of charge (unlike the UK Scheme which funds 50% of any training Scheme), comprises of two elements:
- A training programme delivered nationwide over a period of 6 weeks providing the essential skills needed to make a compliant customs declaration.
- DBEI has provided a €3 million fund for eligible businesses to apply for a Customs Financial Support payment of up to €6,000 per employee that completes the training programme to help support extra costs to manage customs compliance including purchase of necessary software
- Previous actions have included changes to the employment permit system to allow an additional 300 workers to come to Ireland for customs roles and a suite of other customs education training across the country delivered on a regular basis by Enterprise Ireland and the Local Enterprise Offices.
- The main priority of this scheme is to develop significantly more individuals with the capability of effectively completing a customs declaration and registered with Revenue for an EORI number to do so. The programme involves 7 days instructor-led training (5 mandatory, 2 elective) staged over a 6-week period at several regional training locations.
- The focus up to October 31st is to direct a considerable level of training support to the customs intermediary sector. There is also a considerable national awareness campaign pointing out the need for businesses to review their current customs declaration arrangements and to encourage businesses that may be exposed to enrol in the Customs Upskilling Scheme.
The Department of Business, Enterprise and Innovation (DBEI) plays a key role in implementing the Government’s policies of stimulating the productive capacity of the economy and creating an environment which supports job creation and maintenance. The Department has lead responsibility for Irish policy on global trade and inward investment and a remit to promote fair competition in the marketplace, protect consumers and safeguard workers.
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