HC Deb 23 April 1996 vol 276 cc114-5W
Mr. Illsley

To ask the Secretary of State for Northern Ireland what provisions the Department of Economic Development in Northern Ireland makes for giving small businesses access to long-term loans. [26191]

Mr. Ancram

[holding answer 22 April 1996]The Local Enterprise Development Unit has two options for providing small businesses with long-term loan finance. Both options are subject to the business owner having exhausted all other sources of promoter or private sector equity, bank and commercial sources of finance including hire purchase, leasing and the small firms loan guarantee scheme.

The options are:

  1. 1. Preference share capital. LEDU can invest up to £250, 000 in the form of non-voting redeemable non-cumulative preference shares. This capital is normally repayable at the end of a five-year period and LEDU may choose to waive dividends for the first two years of the investment.
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  3. 2. Loans. Loans may be offered where a LEDU preference share investment is not practical. Security is sought for all loans; however, unsecured loans can be offered up top £10,000 and secured loans can be offered over £60,000.