Good News for New Start Up Businesses
The Government has announced a new initiative to help new start up companies who can't secure start up loans from the banks because of the credit freeze, they hope this will create up to 25,000 badly needed new jobs this year.
The scheme is a government backed loan guarantee for businesses who can't secure loans from the banks because they may have no collateral to back up their new enterprise. The Government will effectively go guarantor on the loans from the banks and promise to cover a large portion of the debt if the business fails. The banks will still loan out the money but under strict supervision from the Government to ensure the scheme is not abused.
According to the government the new scheme will:
- Result in 1.2bn in loans over 3 years
- Benefit 13,000 small and medium businesses
- Create 25,000 jobs
- Be worth €300m to the Irish economy, from income tax and PRSI returns, social welfare and additional exports.
The risk will be shared by the Government, The Banks and the Borrowers!
The guarantee will cover up to 70% of the risk and the borrower will a 1pc to 2pc interest rate as a price for the guarantee!
This will help lots of new businesses get up and running as currently they can not get loans from the banks, new business start ups are vital for this Country to gat back on its feet again, we have some great people with great business ideas but currently they find themselves stuck in a hole because if the credit freeze.