THE GOVERNMENT HAS announced a new low-cost loan scheme to help small businesses recover from the impact of the Covid-19 pandemic.

The loans are available for small and medium businesses (SMEs), including farmers, fishers and other food businesses, going from €25,000 and €1.5 million for terms of one to six years.

The scheme, known as the Covid-19 Loan Scheme, was announced by Tánaiste Leo Varadkar, Finance Minister Paschal Donohoe and Agriculture Minister Charlie McConalogue this morning.

Under the scheme, loans will be made available to businesses whose turnover or profit was impacted by more than 15% due to Covid-19.

The loans will be able to be used for investment, working capital and 30% of funds can be used to refinance existing short-term loans.

The Department of Enterprise has said that the loans will be available without security for funds less than €500,000 and that they will feature a lower interest rate than comparable small business loans.

Launching the scheme, Varadkar said that businesses are now getting back on their feet after several difficult years.

“There are currently more people employed in Ireland than ever before in the history of the state. That would have been unimaginable a few months ago even,” said Varadkar.

“However, many businesses are still getting back on their feet after what has been an incredibly challenging period. I know Putin’s war on Ukraine has caused more uncertainty.

This successor scheme will give SMEs, including farmers, fishers and food businesses, the option to access really competitively priced loans, should they need to avail of that option, in addition to the other help that is available. It’s about giving SMEs as many options as possible.

McConalogue said that the scheme would help alleviate the impact of the pandemic on the agri-food sector.

“The resilience shown by the agri-food sector during the pandemic was remarkable as it continued to produce high quality produce for consumers at home and abroad,” said McConalogue

“This State-backed source of finance will complement other measures introduced by my Department to alleviate the considerable impact of the pandemic on the agri-food sector.”

ISME, the Irish Small and Medium Enterprise Association, said that the new scheme was interesting on a number of fronts, including the higher unsecured loan cap compared to a previous scheme.

“The unsecured amount has doubled from €250k to €500k, likely to increase attractiveness to both borrowers and lenders,” said a spokesperson for ISME.