Cork South Central Fine Gael TD, Jerry Buttimer, has said that the Credit Guarantee Bill 2012, which has been published by the Minister for Jobs, Enterprise and Innovation, Richard Bruton, will make it easier for small and medium businesses in Cork to access credit and create jobs.
“Access to credit is the biggest single challenge facing businesses across Cork. Every week I meet local business people who express their frustration and dismay at their inability to access credit from the banks. Small and medium businesses need a reliable stream of credit to function, particularly in the current difficult trading environment. The Credit Review Bill will directly tackle this problem.
“The Bill provides for the establishment of the Temporary Partial Credit Guarantee Scheme, which will help commercial viable SMEs struggling to get finance. It will support businesses that have insufficient collateral, and those that are operating in sectors with which the banks are not familiar. Under the Scheme the State will provide a 75% guarantee to banks against losses on loans they give to firms with growth potential.
“This will allow for tens of millions of euro to flow into Irish business, which, in turn, can strengthen and expand their operations and create jobs. Initially, the Scheme will facilitate an extra €150 million in lending per year – that will benefit more than 1,800 businesses across the country. This lending will be on top of the lending targets already set down for the two pillar banks.
“There are obvious positive knock on benefits for the wider economy from this Scheme. By supporting viable businesses, the Government is helping to get people off the live register and stimulate local economic activity. It’s estimated that there will be a net gain for the Exchequer of €25 million per €150 million in lending.
“For the businesses involved there are also benefits beyond the initial access to credit; the Scheme will allow them to build up a positive track record with the lender, which should make it easier to secure traditional loans in the future.
“The publication of the Credit Guarantee Bill is a key commitment under quarter one of the Action Plan for Jobs. A range of other measures under the plan will be delivered this year aimed at improving conditions to help businesses to flourish and create jobs.”