Foster launches new loan fund for small businesses
Enterprise Minister Arlene Foster today announced a new £5million NI Small Business Loan Fund as part of Invest Northern Ireland’s Access to Finance Strategy.
The Fund which will be delivered by Ulster Community Investment plc (UCI), a subsidiary of Ulster Community Investment Trust Ltd (UCIT), will help bridge a gap where other funding options have been exhausted.
Arlene Foster said: “The fund will provide loans to individuals, private companies and social enterprises in the SME and micro enterprise size range. Northern Ireland is dominated by small and micro businesses with proportionately more small businesses relative to its population base than the rest of the UK. This new fund will help bridge the gap in funding available to small businesses across all sectors in the start-up and growth phases of development.
“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. It is the fourth offering from Invest Northern Ireland as part of its wider Access to Finance strategy that already includes the Growth Loan Fund, Co-Fund NI and the Northern Ireland Spin Out (NISPO) funds.”
Loans to recipients will be in the range of £1,000 - £50,000 and will be higher risk in nature, as traditional bank funding will not have been available or will have been fully exhausted. It will sit alongside other funding sources such as own funds, bank funding or credit unions. The loans will typically be unsecured and personal guarantees may be sought. Applicants will need to clearly demonstrate their ability to service the loan repayments.
There is a maximum loan amount of £15,000 to start-up enterprises, with potential for follow-on lending up to a maximum of £50,000. Existing businesses can apply for amounts up to £50,000. In addition, there will be mentoring support for borrowers under £15,000.
Seamus O’Prey, Chair of UCIT Ltd said: “We are delighted to have been appointed to manage the NI Small Business Loan Fund. The Fund will be investing over the next five years and we look forward to working with Invest NI in delivering what is a new and innovative product in Northern Ireland.”