We are now offering business loans under two new lending schemes launched by the Malta Development Bank (MDB), the SME Guarantee Scheme (SGS) and the Guaranteed Co-Lending Scheme (GCLS).
Lending under both schemes will be made available to eligible customers which demonstrate a business need and a viable credit proposal in line with the purpose of the schemes.
A summary of the key terms of each scheme is available below - you may get in touch with your Relationship Manager for further details about the schemes and the application process. Other terms and conditions apply.
SME Guarantee Scheme (SGS)
Objective of the SGS is to facilitate access to finance to businesses for new investment, particularly in support of a greener and more digitally oriented economy.
The purpose of the financing covers a wide spectrum of possible activities including:
The establishment of new enterprises,
Capital for the strengthening and/or stabilisation of the general activities of an enterprise;
The realisation of new projects, penetration of new markets or new developments by existing enterprises,
Investment related working capital,
Business ownership transfers, in whole or in part, as long as this does not create or enhance a position of significant market dominance and conforms with applicable legislation.
SME Guarantee Scheme Key Terms:
Term of loan - up to a maximum of 10 years
Minimum own contribution of 10% of total project costs
Minimum loan size - €100,000
Maximum loan size - €750,000
Last date for inclusion of loans under the scheme - 31 December 2024
Security – loans will be covered by a guarantee by MDB of 80% of the loan amount.
Additional collateral up to a maximum of 20% of the facility amount may be requested
Moratorium on capital repayments – maximum 12 months (at the start of the repayment period). A longer moratorium may be granted on a case by case basis subject to MDB approval.
Guaranteed Co-Lending Scheme (GCLS)
Objective of the GCLS is to enhance access to finance to eligible companies that face financial and other constraints and require significantly higher financing than the maximum limit allowed under the SGS.
The purpose of financing under this scheme includes:
The establishment of new enterprises,
Capital for the strengthening and/or stabilisation of the general activities,
The realisation of new projects, penetration of new markets or new developments by existing enterprises.
Guaranteed Co-Lending Scheme Key Terms:
The GCLS is a risk-sharing facility involving co-lending between the MDB and the HSBC on a 50:50 basis.
Term of loan - the scheme offers two types of loan tenors: with a maximum of 10 years and 15 years. The tenor of the loan determines the applicable state aid regime as follows: (i) Up to 10 years – De Minimis (ii) Up to 15 years
Borrower’s front contribution towards the project – minimum of 20% upfront cash contribution
Minimum loan size - €750,001
Maximum loan size - €10,000,000 depending on term of loan and State Aid regime
Loan amounts and compatibility with State aid regimes - The GCLS will be implemented in line with the provisions of the De Minimis Regulation and the General Block Exemption Regulation (GBER).
Last date for inclusion of loans under the scheme - up to 31 December 2024
Moratorium on capital repayments – Maximum 24 months
The MDB will provide an interest rate reduction on the value of the loan granted by it and an uncapped guarantee of 60% on the commercial bank’s part of the lending.
For more information customers can contact their Relationship Manager. If you are not yet our customer, you can contact us here for more information.
Get in touch to learn more about our banking solutions and how we can help you drive your business forward.