New loan opportunities open up for exporting companies
On government sitting, draft legislation was approved by which a loan measure “Subordinated loan programme” funded from structural funds shall be created for exporting companies.
The “Subordinated loan programme” is aimed at Estonian companies that export or have plans to export, who lack own funds or sufficient guarantee property to finance the project, or whose project is considered to be too risky by a financing institution.
“The purpose is to improve the availability of capital for companies. The measure of subordinated loan supports the growth and expansion of companies,” said Juhan Parts, Minister of Economic Affairs and Communications.
Within the programme, two types of loan shall be issued: subordinated loan for technological investments and also offering of subordinated loan within the support package for entrepreneurs shall be continued.
Due to the economic recess, today entrepreneurs still experience problems in obtaining loan and leasing, as, for example, upon investment into more complicated machines and devices, self-financing of up to 40% is requested. At the same time, the self-financing capacity of entrepreneurs is still weak, as during the years of economic recess the turnover, profitability and equity capital decreased. The values of possible guarantee properties have still not increased. To prepare for the new growth phase, however, investments need to be made to increase productivity and find new markets.
The support measure of Enterprise Estonia has been exhausted by today, also the additional support package to ensure companies’ access to capital has been closed, and thus the need for a new loan measure has been created.
The loan programme with a capacity of approximately 27 million Euros will be intermediated by Foundation KredEx in cooperation with banks and leasing companies. As estimated, the loan measure for technological investments will be opened in May; offering of subordinated loan is continued without problems also now.
The measure shall be financed 100% from the funds of the European Regional Development Fund.
