Guide to the COVID-19 Credit Guarantee Scheme

  • €2bn fund which is 80% backed by a state guarantee.
  • Facilitates low-cost lending to Micro, Small and Medium-sized Enterprises, and Small Mid-Caps adversely impacted by Covid-19.
  • Primary producers in agriculture, horticulture and aquaculture are included for the first time.
  • The scheme is overseen by the Strategic Banking Corporation of Ireland (SBCI) and currently applications can be made directly through AIB, Bank of Ireland and Ulster Bank. SBCI is engaged with other potential lenders who may participate in the scheme.
  • 31st December 2020 is the deadline for applications.

  • The purpose of the scheme is to provide liquidity and working capital to businesses.
  • The Scheme will permit the refinancing and rollover of debt incurred as a result of Covid-19 e.g. Covid-19 related expenses that were initially funded through short term/temporary facilities such as overdrafts or merchant credit.

The money can be used for working capital or investment requirements:

  • Purchase beef animals for onward sales in 12-18 months.
  • Purchase breeding stock e.g. dairy cows or heifers and/or beef cows or heifers.
  • Purchase machinery and equipment for farm.
  • Carry out some smaller scale farm investment.
  • Upgrade grazing infrastructure e.g. reseeding, drainage, fencing, improving roadways and water systems on the farm.

Unsecured up to €250k.

Terms available from three months up to five and a half years.

Amounts will range from €10k to €1m – 1 of the following 3 criteria must be met:

  • Double the borrower’s annual wage bill for 2019, or for the last year available (In the case of a borrower created on or after 1 January 2019, the maximum loan must not exceed the estimated annual wage bill for the first two years in operation).
  • 25% of the borrower’s total turnover in 2019.
    In limited cases and with appropriate justification, the amount of the loan may be increased to cover the liquidity needs of the borrower from the moment of granting for the coming 18 months for SMEs.

12 months interest and/or capital moratoria at the lender’s discretion.

Interest rates vary lender to lender, on average, less than 3% for amounts less than €250k.

Rates are negotiable above €250k.

A premium – determined by the length of term – is added to the interest rate to pay for the cost of the state guarantee.


Loan term duration ≤ 1 year ≤ 2 yrs but > 1 yr ≤ 3 yrs but > 2 yrs ≤ 4 years but > 3 yrs  ≤ 5 years but > 4 yrs > 5 years
Premium (%) 0.15 0.26 0.29 0.5 0.61 0.68

Sole traders and private limited companies can apply.

While the business must have been impacted by Covid-19, it does not have to be in a position of severe financial difficulty.

However, an applicant must self-declare to the lender that on 31st December 2019:

  • That the business was viable and was not in financial difficulty

Moreover, an applicant must-self declare that:

  • The business can return to viability in the future, if it is currently unviable because of Covid-related losses

Finally, to qualify for the scheme, an applicant must self-declare a 15% loss to its actual or projected turnover/profit as a consequence of Covid-19:

  • Farmer him/herself contracted Covid-19 and had to hire labour.
  • Drop in output prices – vs. 2019 or 2020 expected pre-Covid.
  • Livestock retained on-farm for longer than anticipated.
  • Expansion plans put on hold.
  • Reduction in livestock purchases/purchases completed at different times compared to normal.
  • Reduction in cereal crops planted – due to Covid-19 – and/or reduction in malting barley price due to reduced requirement for malting barley.

Once eligible, the lender’s normal credit criteria will apply to the applicant

Farmer was unable to sell animals at the normal time due to mart closures in Spring 2020.

When marts reopened prices were down on last year but farmer had to sell animals as he no capacity on farm to keep animals for longer.

Consequently the farmer’s actual income was reduced because of Covid-19.

Dairy farmer planned to purchase cows to increase cow numbers in Spring 2020.

As a result of Covid-19 and the outlook for milk prices at the time the farmer decided not to purchase the additional stock.

As a result the farmer’s projected income in 2020 was reduced compared to the farmers actual profit in 2019.

Beef Finisher sells steers in late Spring 2020.

Farmer had projected a higher sale price at beginning of year but received a reduced price for his animals because of the effects of Covid-19.

Farmers can apply directly to AIB, Bank of Ireland or Ulster Bank to avail of the Covid-19 Credit Guarantee Scheme.

For more information visit

SBCI Covid-19 Credit Guarantee Scheme section.

AIB CCGS Section.

Bank of Ireland CCGS Section.

Ulster Bank CCGS Section.

If you require more information you can contact us here.