Malta has a number of schemes offering credit facilities with low guarantee obligations and beneficial terms:

(i) The BOV JAIME Financial Package

The SME sector is critical to the Maltese economy.  Through the BOV JAIME financing package, SME’s may obtain financing of up to a maximum of Euro 500,000.The BOV JAIME Financing Package provides SME’s with the financing for capital investment and related working capital at:

• Advantageous interest rates - An interest rate reduction of more than 2% when compared to normal market rates relating to such type of lending.  This results in a final interest rate of 3.5% and
• Reduced collateral obligations - The Bank will seek to secure only 25% of the total portfolio amount.  At transaction level, the percentage amount of extendible security can increase or decrease in line with the risk profile of the proposal.   

This will assist your company to:

• Improve the performance of your operations through capital investment and related working capital
• Invest in research and development and innovation which will contribute towards the launching of new products and services and
• Tap into new export markets by expanding and improving your Malta based operations.

At KSi Malta, we provide a range of services to assist you with obtaining the JAIME Financing Package, including assistance with compiling a professional business plan, preparing financial projections and the assessment of the viability of your business idea.

(ii) Micro-Guarantee Scheme

The Micro-Guarantee Scheme was launched by the Maltese Government and is operated through Malta Enterprise (an agency of the Government of Malta).

Through this scheme, the Government of Malta is offering small businesses and start-ups the opportunity to borrow up to €100,000 from Maltese banks with the need to only offer minimal security.

The conditions for such a scheme are generally very straightforward to satisfy and include:

• the funds must be used for capital expenditure, i.e. for acquiring assets such as restaurants, software, plant and equipment. The interpretation of capital expenditure is generally very wide and there are no restrictions on the type of capital expenditure to be undertaken
• the maximum amount borrowed of €100,000 is to be repaid over a 10 year period
• one must only guarantee up to 10% of the amount borrowed either by cash or property
• the borrower must have some form of operations in Malta. This means that non-Maltese aspiring borrowers are required to form a Maltese company and employ a minimum of one employee. On the other hand, Maltese resident sole traders may still avail themselves from this scheme despite not having a Maltese company.

Generally, interest on a credit facility would range between 4.5 and 7%, depending on the project to be undertaken.

The main sectors which normally avail of either the JAIME Scheme or the Micro-Guarantee Scheme include:

• Information and Communication Technology (ICT)
• Specialised Tourism Functions
• Manufacturing (pharmaceuticals, biotechnology, aviation, and other sophisticated technology)
• Green Energy (such as installation of photovoltaic panels)
• Gozo as an ‘ecological island
• Accommodation and Food
• Arts, Entertainment and Recreation

At KSi Malta, we can assist companies wishing to benefit from any of these schemes by identifying the ideal contacts and prepare the necessary valuations, appraisals, plans, studies and applications.