European Investment Bank Financial Support to Local MSME’s
In response to the outbreak of the Covid-19 pandemic and the resulting economic crisis, European Investment Bank (EIB) funding will be provided to SMEs to mitigate their short-term financing constraints in the form of loans through the Saint Lucia Development Bank.
The EIB is the long-term lending institution of the European Union owned by its Member States. The EIB is active in around 160 countries and is the world’s largest multilateral lender for climate action projects, development, innovation and skills, small and medium-sized businesses, infrastructure and cohesion.
The EIB offers loans, guarantees, equity investments and advisory services.
Small and medium businesses play a key role in the global economy by providing fresh ideas, compelling new products or services and high growth potential. Just like the SLDB, the EU recognizes that the main challenges of these businesses is often their inability to access affordable financing. The SLDB fosters entrepreneurship, encourages the creation of new companies and helps small and medium businesses grow.
What is being offered?
Investments and expenditures which could be considered for financing include:
- The purchase, renovation or extension of tangible assets other than land; •
- Investment in intangible assets, i.e.: – Development, planning and financing costs during the construction phase;
- Research & Development expenses (fees, development costs and gross salaries); –
- Building up of distribution networks (asset and/or trademark acquisition, operational costs and labour costs). •
- Generation change or staff-related enterprise transmission, allowing for a continuation in economic activity of the enterprise. •
- Medium and long term working capital needs to allow MSME to finance liabilities associated with their trading cycle, as part of their normal activities.
Loan Amount and Term
The amount of an EIB loan can be up to 100 % of the project cost but cannot be higher than EUR 1 million (or the equivalent in Eastern Caribbean Dollars).
What are the benefits for your Business?
- You can access financing with a longer tenor which is a better offering than what is currently available under other lines of credit.
- You can receive potentially reduced interest rates compared to SLDB’s other business lending rates.
- It allows you to invest significantly in your business without adversely affecting your cash-flow or liquidity.
Borrower eligibility
- Eligible clients are small and medium sized enterprises (“SMEs”), with less than 250 employees (full-time equivalent).
- All eligible projects shall be economically, environmentally, technically and financially sound.
For further information do not hesitate to contact the Saint Lucia Development Bank.