The Malta Independent 3 March 2024, Sunday
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BOV launches new financing package for SMEs

Monday, 13 May 2019, 14:31 Last update: about 6 years ago

Bank of Valletta and the Malta Development Bank today launched a new €50 million financing package for Small and Medium sized Enterprises ( SMEs).

The scheme called ‘BOV SME Invest’ is aimed at SMEs planning new capital projects. It provides easier access to finance to SMEs through reduced collateral requirements and finance costs. Enterprises may seek bank financing up to a maximum of €750,000 at a 3.5% interest rate, and what the bank’s representatives described as reduced collateral obligations.

The scheme will make available €50 million in financing, with €10 million being guaranteed by the Malta Development Bank.

Prime Minister Joseph Muscat said that the decision for Malta to have a national development bank was taken many years ago.

He said that taking the decision to set it up has had an exponential effect. By guaranteeing €10 million, BOV can provide €50 million, which will see SMEs further invest as they would not take out a loan to cover the entirety of a project, he said.

On bank regulations in general, he said that BOV is caught between a rock and a hard place, with economic pressure as companies want to grow, and international regulations becoming more stringent.

While at EU level BOV is not considered a big bank, it is a systemic bank considered to be very big for Malta.

Josef Bonnici, Chairman of the Malta Development Bank (MDB), said that Malta’s economic success depends largely on the growth of SMEs, with these companies accounting for around 2/3rds of Malta’s workforce.

The scheme is the product of extensive discussion between BOV and the MDB, he continued.

Finance Minister Edward Scicluna said that he is pleased that a Maltese entity could provide the same things like the European Investment bank can too.

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