In 2014, business startups received loans totalling EUR 5.8 million (LTL 19.9 million) from the Entrepreneurship Promotion Fund (EPF). This was 9 per cent more than in 2013 (EUR 5.3 million, or LTL 18.3 million). Last year, financial assistance from the Fund was granted to 463 new entrepreneurs – 55 per cent more than the year before – and young people under the age of 29 years were the most active in starting up a new business.
The education and ongoing consultation provided to entrepreneurs have worked. Individuals with fully thought-through startup ideas complete with market analysis have come forward. The number of entrepreneurial Lithuanians with a responsible attitude when it comes to implementing business ideas has grown rapidly.
“Last year, more individuals starting businesses as well as small and micro-enterprises took up EPF loans than during all the years that it has been operating since 2010. Although the average amount of a loan fell by one third to EUR 12,500 (LTL 43,000), the overall funding volumes grew and there was an increase in the number of individuals planning to start their own business. This trend is particularly noticeable among the younger residents of our country“, said Tomas Valauskas, Head of the EU Project Division of the Lithuanian Central Credit Union (LCCU) which coordinates EPF loans.
Last year, young people under the age of 29 years received EPF loans totalling EUR 2.2 million (LTL 7.6 million) – 41.7% more than the year before (EUR 1.6 million, or LTL 5.4 million). The EPF funding was allocated to 188 young people – two times more than in 2013, when loans were granted to 91 representatives of this age group.
Based on the data of the representative study carried out on the initiative of the LCCU in the autumn of 2014, 10% of Lithuania‘s population is planning to start up a business within the next 24 months, and the majority of them are young people. Sixteen per cent of individuals in the 18-25 age group and 12% of individuals in the 26-35 age group intend to start their own business within the next 24 months.
According to Tomas Valauskas, after considering the growing levels of entrepreneurship and the popularity of the EPF, it was decided to extend EPF loans until 30 September, 2015 as well as accepting applications from entrepreneurs for interest compensation until 31 August, 2015. New entrepreneurs will continue to receive free consultation and special training.
During the five-year period of the EPF’s activities, new entrepreneurs were granted loans totalling EUR 17.7 million (LTL 61 million). The largest loan amount was for EUR 24,900 (LTL 86,000). One of the main advantages of this funding is that 95 per cent of the paid interest on a loan is refunded.
A total of 56 credit unions grant loans with the Lithuanian Central Credit Union (LCCU) coordinating the granting process and UAB Investicijų ir Verslo Garantijos manages the Fund. The Ministry of Social Security and Labour of the Republic of Lithuania started this entrepreneurship promotion instrument and allocated funding to the Fund from EU Structural Funds.