Micro-finance plan ‘could create thousands of jobs’

The launch of a €90m micro-finance scheme by the Government has the potential to create thousands of jobs, it was claimed yesterday.

The scheme was launched by the Enterprise and Jobs Minister Richard Bruton. It means that from Monday, businesses and sole traders employing up to 10 people that have been refused bank loans of up to €25,000 will have their applications accepted and processed.

Based on the Government’s projections the scheme will provide more than €90m in extra lending to 5,500 businesses and create an additional 7,700 jobs over 10 years.

The scheme will initially facilitate €40m in additional lending over the next five years, with provision for the scheme to be extended to provide an additional €50m of lending over a further five years.

Mr Bruton said that governments don’t create jobs but they can make it easier for businesses to set up, expand, succeed, and create jobs.

“The Government is acting to ensure that a much wider range of businesses who are refused credit by the banks have access to micro-finance lending, and I am delighted to announce that the micro-finance scheme is now open for business.

“Start-ups, sole traders and micro-enterprises who have been refused by the banks can, from next Monday, apply via their local CEB for loans up to €25,000 to expand or to get their business off the ground. I urge people with business ideas across the country to speak to their CEB, get their business off the ground and create the jobs we need.”

ISME chief Mark Fielding welcomed the initiative, saying it was small business across the country that provide most of the country’s employment.

“Micro businesses are in the front line of this prolonged recession and when funding was most needed, the banks reneged on their commitment, necessitating this further government intervention. We now hope this scheme will initially assist in retaining and ultimately increase employment in the ‘seed-bed’ of the economy.”

The spokesperson for the Irish Banking Federation said it had been working with the department to implement the initiative: “Banking sector support for this particular initiative is reflected in the €15m competitively-priced loan finance from banks that will be provided to supplement the initial €10m of exchequer funding.”