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Proposals for Credit Guarantee Scheme
PRACTICE AREA GROUP: Corporate
The Minister for Jobs, Enterprise and Innovation has published the Credit Guarantee Bill 2012.
The Bill provides for the establishment of a Temporary Partial Credit Guarantee Scheme. The Scheme is targeted at micro, small and medium enterprises with not more than 250 employees. It will enable the Minister to provide a specified level of guarantee to lending institutions on qualifying loans to job creating companies.
The Minister will be empowered to:
- Give loan guarantees
- Designate lending institutions as participants in the Scheme
- Set eligibility criteria for borrowers in the Scheme
- Set loan conditions
- Set out the liability of the Minister in respect of payment of guarantees. The guarantee will be 75%, and claims will be payable up to a maximum of 10% of the aggregate of all loans made under the guarantee scheme, the aggregate not exceeding €150 million in any one year, thereby capping the State’s liability
- Assign a contractor to oversee the Scheme