Fabian Demicoli

Financing opportunities for SMEs


GRTU in
collaboration with Bank of Valletta have this week held an information session
focusing on SME financing. During
this session CEO Abigail Psaila Mamo mentioned that 99.8% of Maltese
enterprises are SMEs and 94% of these consist of micro enterprises.

The smaller
the enterprise the more vulnerable it is in accessing finances. She also
mentioned that GRTU is concerned that the level of lending is declining.
However it is also evident that lending to SMEs has declined.

This
session focused on funding programmes that are aimed at addressing negative
situations in financing caused by the financial crisis. The funding programmes
available included:

COSME

This
programme was presented by Maciej Otulak, European Commission,
Directorate-General for Enterprise and Industry, Unit SME Access to Finance
which is currently working on the 2014-2020 programme for the competitiveness
of enterprises and SMEs (COSME). He explained that the programme's aim is to
increase access to finance for SMEs through appropriate financial instruments
such as mutual guarantee societies, banks lending and equity participations for
early and growth stage investments. The COSME programme focuses on high risk
loans which would most likely not be able to acquire financing. This financial
instrument has 2 funding opportunities which include:

Loan Guarantee Facility

guarantees for
loans to SMEs up to € 150 000*

securitisation of SME debt finance
portfolios

* above €
150 000 for SMEs not qualifying for InnovFin (Horizon 2020)

 

Equity Facility for Growth

focus: growth
stage

final beneficiaries: growth-oriented
SMEs

also possible: early stage and
multistage funds

BOV Start Plus

 

During the information session Mark Scicluna Herrera Head of the EU
Business Development at BOV introduced the BOV Start Plus. This business loan
is aimed at start-ups and micro enterprises who need funding for investment
purposes and initial related working capital requirements.

Loan offer and
criteria:

Up to €25,000 loanAll sectors eligible excluding
agriculture/fisheries (some restrictions on transport)

Contributes 20% of total investment

Maximum loan term: 5 years (minimum
maturity 1 year)

Monthly repayments. A moratorium of
up to 6 months may be considered.

No extendible security is being
requested on this lending facility.

No annual processing fees and early
repayment fees.

4.65%
Interest Rate (as from 16th June 2014)

Available till 16th December 2016 (or
until funds are fully absorbed)

For further
information kindly contact via email: or telephone: 2275 1160

 

 

 

Karl Herrera
explained that through the Micro Guarantee, eligible enterprises may obtain a
guarantee covering loans of up to €100,000 which are used to finance projects
leading to business enhancement, growth and development.

This is
a one time incentive available to business, including start-ups, that have:

at least 1 but
not more than 50 (full-time equivalent) employees; and

a turnover and balance sheet total
that does not exceed €10 million

Applicants are required be adhering
to regularity and fiscal obligations

Micro Guarantee 80%

Available
to enterprises having at least two full time employees that:

are
engaged in the production and manufacture

provide services related to
production and manufacture

offer an innovative product or
service and which operate within a
non-saturated local market

The proposed projects should lead to:

generation of new jobs

growth in foreign markets

 

Micro Guarantee 65%

Available to all eligible
enterprises that require funding for projects leading to:

the establishment
of new business

the provision of new or improved
products, services or processes

the adoption of new technology

reduction in operating costs

increase in sales

retention or generation of jobs

increased productivity

growth in foreign markets

 

Further information in the Micro Guarantee can be found at:

http://www.maltaenterprise.com/en/support/micro-guarantee-scheme

 

 

 

 

 

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