Seven of the Republic’s largest credit unions and three non-bank lenders have signed up to participate in the Government’s €2 billion Covid-19 Credit Guarantee Scheme.
The group of credit unions is comprised of Cara Credit Union, Mallow Credit Union, First Choice Credit Union, People First Credit Union, St Canice's Credit Union, Limerick & District Credit Union and Synergy Credit Union. They have 250,000 members between them and are all members of Metamo, a joint venture between credit unions and Fexco.
The scheme, officially launched last September through AIB, Bank of Ireland and Ulster Bank, offers an 80 per cent State guarantee to participating lenders to provide Irish businesses, including those in the farming and fishing sectors, with access to low interest loans as they respond to the impacts of Covid-19.
Non-bank lenders Linked Finance, CapitalFlow and Finance Ireland have also been approved to offer loans through the credit guarantee scheme.
Loans of up to €1 million are available for up to 5½ years through the plan, though individual lenders may set lower limits. No personal guarantees or collateral is required for loans under €250,000.
However, demand for loans to date has been muted as businesses have been reluctant to take on additional credit amid heightened uncertainty.
Some 2,249 loans, totalling €118 million, have been drawn down by SMEs as of January 7th, according to a spokesman for the Strategic Banking Corporation of Ireland, which oversees the guarantee scheme.