€10 million for small enterprises

An agreement between the government and the European Investment Fund will see small and medium enterprises benefitting from €10 million in support schemes in about seven months' time.

The money is part of the EU's Jeremie Fund aimed at helping small businesses to restructure, improve their service or expand.

The agreement was signed at the Finance Ministry and EIF chief executive Richard Pelly explained the money would be made available in the early autumn after financial institutions were roped in to match the fund with another €10 million.

Financial institutions and banks will shortly be asked whether they are interested in partnering with the EIF after which they would have enough time to come up with investment packages for small businesses.

SMEs would use their banks as a point of contact to tap into the funds. No conditions will be imposed on the banks in terms of charges and penalties linked to the provision of funds. However, the interest margin had to be "commercially reasonable" and competitive to be attractive to the borrower, an EIF official said when asked.

Finance Minister Tonio Fenech said there was a potential for the fund to increase if the take-up was good.

The Jeremie Fund is particularly aimed at small enterprises that would otherwise find it difficult to raise €25,000 for improving their business.

ksansone@timesofmalta.com