Direct loans to business entities affected by actions of third countries
What are the benefits?
The instrument is intended to reduce the effects of restrictions on international trade with third countries by providing financing in the form of loans for the working capital of legal entities engaged in business or of entrepreneurs.
Who is eligible?
The loans can be applied for by small and medium-sized enterprises (SMEs) and large enterprises that meet the requirements for applicants.
In order to obtain a loan, one is to apply to INVEGA by submitting an application and related documents through the electronic application system.
Documents to be submitted
|To be submitted by enterprises||To be submitted by entrepreneurs carrying out individual activities|
Application (to be filled in and submitted via the electronic application system).
SME status declaration signed by the head (entrepreneur) (except for the case when a borrower confirms that it is a large enterprise)
|Documents describing the borrower: legal entity’s incorporation (business) documents, copies of the personal identity document of the head, information about members of the legal entity (shareholders, owners, beneficial owners), the current shareholding structure of the borrower and a free-form document indicating links between the business entity and related enterprises.|
|Borrower's financial condition and forecasts (Annex No. 1 to the description).|
|Business plan (Annex No. 2 to the description).|
|Decision of the competent management body of the business entity on taking a loan, pledge/mortgage of assets and appointment of persons authorised to sign relevant contracts or transactions.|
|Entrepreneur’s individual activity registration documents, copy of the personal identity document and a free-form document indicating links between the entrepreneur and related enterprises.|
|Financial documents for the past two financial years or a shorter period (if operations have been carried out for less than two years).|
|Interim financial statements for the preceding quarter of the current financial year or as of the last day of the month before the application was submitted (entrepreneurs may submit equivalent documents).|
|Accounting certificate about imports from or exports to the People's Republic of China (state code: CN) and total imports or exports (including from and to the European Union Member States) in the period from 1 January 2021 to 31 December 2021.||(for non-VAT payers)||(for non-VAT payers)|
|Reasoned explanation of the changes in activities of the business entity and documents (data) submitted along with the application and documents supporting the explanation if a business entity is submitting an application repeatedly (i.e. when the previous application(s) was/were rejected).|
|Three certificates on refusal to finance the business entity from different financial institutions*. Certificates must be submitted after INVEGA has assessed the application.|
* At least one certificate must be from a bank licensed in the Republic of Lithuania (or a branch of a foreign bank licensed in the EU/EEA, established in Lithuania) and at least one certificate – from a financial undertaking.
Note: If necessary, a business entity may be asked to provide additional documents or information to support the data.
|Borrower||SMEs and large enterprises that meet the requirements.|
|Purpose of the loan||The loan is intended to finance the working capital of the borrower and will be used to search for new markets and/or new suppliers and/or new resources and/or to enter new markets.|
After the risk assessment of the borrower and the default on the loan has been carried out by INVEGA, according to the methodology approved by INVEGA, loan securities shall apply to the loan, depending on the level of risk.
|Loan repayment postponement period||6 months|
Loan funds may not be used:
|Agreement conclusion and administration fees||A one-time fee for the conclusion of a loan agreement at the rate of 0.4% on the amount of the loan but in any case not less than EUR 200.|
|Fee for change of the terms and conditions of the agreement and the instalments schedule||EUR 100|
You can apply for a loan if:
- You are a small and medium-sized enterprise (SME) or a large enterprise.
- You do not carry out activities that fall within the financial, agricultural, forestry, fisheries and aquaculture sectors.
- You operate in the Republic of Lithuania.
- During the last two financial years you have not been an enterprise or a group of enterprises (if you belong to a group of enterprises) in distress or you were in distress during the last two financial years, but you are not considered to be in distress at the time of submission of the application.
- You are not an enterprise in bankruptcy and/or restructuring or an entrepreneur who is subject to bankruptcy proceedings instituted against him as a natural person.
You meet the minimum criteria for reliable taxpayers.
- You have submitted a set of financial statements to the Centre of Registers for the past two financial years or a shorter period (if you have been operating for less than two years), which details the equity composition. If you are an entrepreneur, you have to submit to INVEGA financial documents for the past two financial years or a shorter period (if you operate for less than two years).
- You have not received state aid which has been declared unlawful and incompatible with the internal market by a decision of INVEGA and/or the European Commission, or you have repaid the full amount of such aid, including interest, in accordance with the procedure laid down in legal acts.
- You are not a state and municipal enterprise or an enterprise in which 25 percent or more of the shares in capital or the votes of the members are held by the state and/or municipality, separately or jointly.
- You have provided evidence (3 certificates) that financial institutions have denied you a loan of an appropriate amount. Certificates must be submitted after INVEGA has assessed the application. At the e-mail address indicated in the application, the borrower shall be sent a form (created by INVEGA) of the certificate of refusal to finance a business entity. The borrower must provide three certificates of refusal to finance the business entity to INVEGA signed by financial institutions to the effect that the borrower is denied financing under the conditions specified in the certificate of refusal to finance a business entity. In any case, at least one certificate must be signed by a bank licensed in the Republic of Lithuania (or a branch of a foreign bank licensed in the EU/EEA, established in Lithuania) and at least one certificate – by a financial undertaking, as it is defined in the Law of the Republic of Lithuania on Financial Institutions. Three certificates of refusal to finance a business entity must be submitted to INVEGA via the electronic application system within 30 business days after receipt of the INVEGA’s request to submit them.
- The share of imports to or exports from the People's Republic of China (state code: CN) makes at least 25% of the total imports or exports (including with the European Union Member States) from 1 January 2021 to 31 December 2021 and, if the principal activity of the borrower is wholesale and/or retail trade, it shall be granted a loan only if the share of exports from the People’s Republic of China (state code: CN) makes at least 25% of the total exports.
- In your business plan, you prove your need for a loan.
- The borrower's risk and/or the risk of default on the loan is at the acceptable level according to the methodology approved by INVEGA.
- Applications for a loan are accepted until 31 October 2023.
- Loan agreements are signed until 31 December 2023.
- Loans are disbursed no later than on 29 February 2024.
Periods may be extended.
EUR 130 million from the INVEGA fund has been allocated for the implementation of the instrument.
- The maximum loan amount per borrower may not exceed EUR 5 million. If the borrower belongs to a group of enterprises, the amount of the loan for the borrower's group may not exceed EUR 10 million.
- The borrower must use the loan funds within 6 months after the date of signing the loan agreement. If the borrower fails to use the loan funds or a part of them, the borrower must return the unused portion to INVEGA.
- Loans shall be granted for a period not exceeding 24 months, including the period for which the loan repayment is postponed, which shall not exceed 6 months from the date of signing the loan agreement.
- The number of loans per borrower is not limited, but the total amount of loans granted per borrower may not exceed EUR 5 million. If the borrower belongs to a group of enterprises, the total amount of the loans granted for the borrower's group may not exceed EUR 10 million.
Interest on loans
Loans are granted at a fixed annual interest rate.
The preliminary fixed annual interest rate on the loan depends on the credit risk rating of the borrower and the value of the collateral.