Irish peer-to-peer lender Linked Finance has launched a deferred start loan for businesses affected by the coronavirus.
The 15-month loan allows businesses to borrow up to €100,000 (£90,857), with repayments due in 12 monthly instalments after the first three months, during which no interest or capital repayment will be paid.
“This is an extremely difficult time for many Irish small- and medium-sized enterprises (SMEs), but we want to send a message that there are sources of financial support available that can be accessed quickly and easily,” said Niall Dorrian, chief executive of Linked Finance.
“The new deferred start loan we have launched allows companies access to much needed capital, whilst being able to delay repayment of interest and principal for the first three months.
“This is part of a package of measures Linked Finance has introduced to support businesses in every country of Ireland who are facing unprecedented challenges due to coronavirus.
“We hope the government will consider our sector as a key channel that can be used to quickly deploy support to help SMEs that are the lifeblood of employment throughout the country.”
LinkedFinance said that the loan is aimed at businesses who need working capital at a time of reduced cashflow, or firms that need to invest in new equipment to adapt to the current situation.
The first loan was offered on Monday to a business services firm and was funded in one second.
The process for application is the same as for Linked Finance’s usual loans, with businesses filling in an online form and providing simple financial documents such as two years of full accounts, six months bank statements and a tax clearance cert.
There are no assets secured against the loan so also no legal hurdles or fees involved, and early repayment can be made without penalty.
The platform applied a blanket two-month payment break to all its loans across the restaurant, bar, pub and hotel trades.
Linked Finance also announced repayment flexibility on existing loans for businesses in other sectors and said it is willing to consider a break in the repayment schedule of up to three months.
The platform also called on the government to work with the P2P lending sector and other alternative finance providers to use it as a channel for support to SMEs in addition to mechanisms being deployed through the traditional banking sector.