A new £5 million loan fund aimed at individuals, SMEs and micro-sized businesses in Northern Ireland has been announced by the country’s enterprise minister Arlene Foster.
Over the next five years, the NI Small Business Loan Fund will make unsecured loans worth between £1,000 and £50,000 available to small businesses across all sectors in the start-up and growth phases of development. The funding is deemed to be higher risk in nature due to borrowers having already used – or been refused – traditional bank funding options.
Foster said the funding would ‘bridge a gap where other funding options had been exhausted.’ She said: “By ensuring that companies are not held back because they cannot access finance, the NI Small Business Loan Fund will boost business confidence and help SMEs.”.
Northern Ireland’s economy is particularly reliant on SMEs. It has proportionately more small and micro businesses in relation to its population than the rest of the UK.
The NI Small Business Loan Fund forms part of Invest Northern Ireland’s fourth round of funding, which already includes the Growth Loan Fund, Co-Fund NI and the Northern Ireland’s Spin Out (NISPO) funds.
Key points of the NI Small Business Loan Fund:
- Funding will be available to enterprises with fewer than 250 employees
- Applicants must have an annual turnover of less than 50 million euro or a balance sheet total not exceeding 43 million euro
- There is a maximum loan amount of £15,000 to start-up enterprises, with potential follow-up lending of up to £50,000
- Existing businesses can apply for up to £50,000
- Mentoring support will also be offered for those borrowing less than £15,000
- Loans will typically be unsecured and personal guarantees may be required in some instances
- Applicants will need to demonstrate their ability to service the loan repayments.