Strategic Banking Corporation of Ireland (SBCI)

Definition

The Strategic Banking Corporation of Ireland (SBCI) is a state-owned financial institution that increases the availability of funding for small and medium-sized enterprises (SMEs) in Ireland. 

What is the Strategic Banking Corporation of Ireland?

The SBCI wants to address the financing challenges faced by SMEs, such as limited access to credit and high borrowing costs. By doing so, it contributes to the broader economic goal of fostering sustainable growth, job creation, and increased economic activity in Ireland.

Its primary goal is to provide low-cost, long-term financing to SMEs, thereby supporting their growth, development, and competitiveness. The SBCI operates by channelling funds from various sources, including the Irish government, European Investment Bank, and other international financial institutions, to local lending partners such as banks and non-bank lenders.

The SBCI offers various financial products, including term loans, leasing, asset finance, and working capital loans. These products are designed to address the specific needs of SMEs, providing them with more favourable terms and conditions than those typically available in the market. By partnering with multiple financial institutions, the SBCI makes sure that its funds are widely accessible to SMEs across different sectors and regions.

In addition to direct lending, the SBCI supports the development of a competitive and diversified lending market in Ireland. It encourages innovation in SME financing and works to improve the overall lending environment. The institution also plays a role in policy development, offering insights and recommendations to the government on issues related to SME finance.

Example of the Strategic Banking Corporation of Ireland

A small manufacturing company in Cork seeks to expand its operations but struggles to secure affordable financing from traditional banks. The company approaches one of the Strategic Banking Corporation of Ireland’s lending partners. Through the SBCI’s program, the company secures a low-cost, long-term loan tailored to its needs.

As a result, the business can grow its customer base, boost revenue, and create additional jobs, all while benefiting from the favourable loan terms.