Discounted loans/hire purchase for investing in a range of energy saving equipment including building retrofit, insulation, solar panels and heat pumps to reduce energy bills for SMEs and farmers
The Strategic Banking Corporation of Ireland (SBCI) has today launched its €150m Energy Efficiency Loan Scheme to help SMEs and farmers cut their energy bills and reduce their carbon emissions by investing in energy-saving measures.
The scheme will offer discounted term loans, asset finance and hire purchase to SMEs and farmers planning investments in a range of energy-saving equipment including solar panels, heat pumps, LED lightning and other energy-saving technology.
SMEs will benefit from reduced interest rates, with rates as low as 4% to be made available and finance amounts ranging from €10,000 to €150,000 over terms of up to 10 years.
The new scheme is available through Bank of Ireland immediately, with multiple other on-lenders due to follow in the coming weeks.
The SBCI is launching this scheme because:
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It will help SMEs and farming businesses to reduce their energy costs over the medium term and help to alleviate the current pressures arising from rising costs and tighter margins
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It allows Irish SMEs to access a pan-European SME support scheme that can only be offered through EU member states’ national promotional institutions, such as the SBCI
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It builds on the SBCI’s strategy of supporting Irish businesses in their transition to sustainability and expanding into new market segments and loan types where SMEs need lower rates and greater competition
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It extends the SBCI’s risk-sharing capabilities following its successful diversification into this form of lending in recent years
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It supports the Government’s wider plans to accelerate Ireland’s transition to a Net Zero economy
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It will enhance the sustainability of participating SMEs and farming businesses
The Minister for Finance, Paschal Donohoe TD, said:
“The Government is committed to supporting Irish SMEs. We understand that businesses face ongoing challenges arising from changes taking place in our economy and the rising cost of energy. At the same time there are tremendous opportunities for Irish companies. Businesses using the Energy Efficiency Loan Scheme can enhance their competitiveness, address their energy costs and boost their reputation in meeting customers’ sustainability expectations. I urge businesses to exploit the new investment opportunities this creates.”
The SBCI CEO, June Butler, said:
“This is a really attractive new scheme for SMEs that are looking to reduce their energy costs and their carbon emissions. We are conscious that many businesses continue to grapple with the immediate challenges caused by Covid, Brexit and economic uncertainty arising from the terrible events in Ukraine, but we know that SMEs which have the capacity to invest in energy efficiency need better financing options, and this scheme is designed for them.
The scheme underlines our commitment to bringing more and more SME-friendly lending products to market, helping SMEs reduce their costs, manage their cashflow, support jobs and ultimately make their business stronger. We are delighted to launch a scheme that will make SMEs more sustainable with lower carbon emissions and we encourage as many SMEs as possible to make the most of the discounted loan rates it offers.”
Gavin Kelly, CEO Retail Ireland, Bank of Ireland Group, said:
“Bank of Ireland is delighted to make this new Energy Efficiency Loan Scheme available to customers, helping them to cut their energy bills, run a more energy-efficient business and support the national objective of reducing carbon emissions. As the first Irish bank to offer immediate access to this scheme, we believe that initiatives of this type are essential, enabling businesses to future-proof their sustainability.
We are also delighted once again to be partnering with the SBCI in launching this scheme, having previously worked with them to provide valuable funding to SMEs nationwide. Numerous cost pressures are currently placing an added burden on a wide range of businesses, so the introduction of the Energy Efficiency Loan Scheme is timely, and I would encourage eligible businesses to review how they can avail of its benefits.”
Further information on the Energy Efficiency Loan Scheme and SBCI SME lending supports
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To be eligible for finance, the energy efficiency equipment must be listed on the Sustainable Energy Authority of Ireland (SEAI) “Triple E Register for Products”, a list of energy efficiency products that all meet a minimum set of energy efficiency criteria.
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The Scheme, which benefits from a guarantee provided by COSME (the EU Programme for small and medium-sized enterprises) and the European Fund for Strategic Investment (EFSI) set up under the Investment Plan for Europe, will operate until the end of December 2023.
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The SBCI Energy Efficiency Loan Scheme is the latest SME funding provided by the SBCI. Since the SBCI commenced operations in March 2015 it has delivered €2.8 billion to more than 46,000 Irish SMEs.
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In 2021, the SBCI has supported more than 10,000 businesses that have borrowed over €819 million using SBCI finance. Year-end lending figures show a wide geographical distribution deployed across a broad sectoral spread. During 2021, some of the larger sectors availing of SBCI facilities have been Agriculture 25%, Wholesale & Retail 15%, Construction Services 15%, Manufacturing Services 8%, and Accommodation and Food Trade 8%.
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The finance provided has been delivered through a mix of term loans for working capital and investment purposes, leasing, hire purchase, contract hire and invoice discounting, through a network of 35 SBCI on-lending partners, which includes banks, non-bank finance providers and credit unions.
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The strategy of the SBCI, recently refreshed, is to support the development and maintenance of an effective market for the provision of credit to SMEs in Ireland, while maintaining its ability to respond to other major market dislocations and the policy delivery needs of government, like the Climate Action Plan 2021.
14/07/2022