Instrument suspended Direct COVID-19 loans (Phase II from 10/02/2022)
What are the benefits?
The main objective of the measure is to reduce the impact of the COVID-19 pandemic by providing financing in the form of loans for the operating costs of business entities and to reduce the lack of investment loans in the Lithuanian economy caused by the crisis.
Who is eligible?
- Negotiable loans can be applied for by SME entities and large enterprises that meet the requirements for applicants.
- For investment loans – only SME entities may apply that meet the requirements for applicants.
Documents to be submitted for obtaining a loan
|Submitted documents and data must be relevant. E.g. not older than 1 month. Extract from the SE Centre of Registers.|
|Information and documents to be submitted||Negotiable loan
|SMEs and large companies||Entrepreneurs carrying out individual activities||SME companies||Entrepreneurs carrying out individual activities|
(completed and submitted via electronic system for submission of applications)
|SME entity status declaration signed by the manager (entrepreneur) (except when the borrower confirms that it is a large company)|
|Documents describing the borrower: incorporation (activity) documents of the legal entity, copies of the personal identity document of the manager, information about the participants of the legal entity (shareholders, owners, beneficiaries), the relevant shareholder structure of the borrower and a free form document specifying the business entity and the relations of its related companies|
Documents for registration of the individual activity of the entrepreneur, a copy of the personal identity document and a free-form document indicating the relationship between the entrepreneur and related companies and signed by a qualified electronic signature
|Financial position and forecasts of the borrower (Annex 1 to the description)|
|Business plan (Annex 2 to the description)|
Business plan of an investment project planned by a business entity
If you do not have a business plan yet, we suggest that you follow the Business plan structure recommended by Versli Lietuva when preparing it.
|Financial documents for the years 2019, 2020 and 2021. The requirement to submit financial documents for 2019 shall not apply to entrepreneurs operating from 1 January 2020.|
|Interim financial statements for the year 2021 (except when, on the date of application, the borrower should have been and has submitted a set of financial statements for the year 2021 detailing the composition of equity capital to the State Enterprise Centre of Registers) and documents of interim financial statements of the current financial year for the last quarter of the previous year or the last day of the month preceding the submission of the application. If an entrepreneur applies for a loan, it may provide equivalent documents.|
|A reasoned explanation of the changes in the business entity's activities and the documents (data) submitted with the application as well as the documents supporting the explanation, if the business entity submits the application not for the first time (i.e. where the previous application (s) have been rejected)|
Letter of intention of the private investor to participate in the financing of the investment project.
The letter must be provided in the case when the private investor intends to provide a loan*
|The decision of the management body of the business entity, whose competence is to make the relevant decision, concerning obtaining a loan, pledging assets and appointing persons authorised to sign relevant contracts or transactions|
|Three certificates of refusal to finance the business entity from different financial institutions**.
Applicable when applying for a negotiable loan and applying for an investment loan, when INVEGA finances part of the project and the other part is financed by the borrower's own funds, i.e. in addition to financing from other financial institutions. Certificates must be submitted after INVEGA evaluates the application.
* At the request of INVEGA, the private investor must demonstrate that it is financially capable of participating in the investment project and justify the origin of its own funds. If the recipient of the investment loan intends to participate in the financing of the investment project with own funds, in such a case this information must be substantiated in the business plan.
** At least one certificate must be from a bank licenced in the Republic of Lithuania (or a branch of an EU/EEA licenced foreign bank established in Lithuania) and at least one certificate from a financial company.
If you wish to change the terms of the signed contract, it is necessary to submit a request. The application must be signed with an electronic signature (by the head of the company or an authorised person), it is necessary to indicate the contract number in the application. Request to Invega must be sent by e-mail to email@example.com, indicating the contract number in the subject of the e-mail.
Applications for negotiable loans shall be accepted until 16 May 2022, 23: 59. while contracts for negotiable loans must be signed by 30 June 2022. Loans shall be paid out no later than by 31 July 2022.
Applications for investment loans shall be accepted until 31 October 2022, 23: 59, while contracts for investment loans shall be signed until 31 December 2022. Loans shall be paid out no later than by 31 December 2023. In cases where the investment is implemented during construction and/or contract works (including reconstruction), the loan shall be paid out no later than by 31 December 2024.
In this second phase, up to EUR 200 million of INVEGA funds have been allocated for the implementation of the financial instrument: up to EUR 100 million for negotiable loans and up to EUR 100 million for investment loans. After granting investment loans for EUR 100 million, the expediency and conditions for further implementation of the instrument shall be reviewed.
One borrower may be granted one loan of no more than 2 months' average turnover from the funds of the financial instrument.
The amount of the loan issued shall be determined taking into account the actual shortage of funds for the implementation of reasonable plans for business development, change of export or import directions.
|Negotiable loans||Maximum loan amount shall be EUR 5 million (EUR 10 million for the group of companies), but no more than 25 percent of the 2019 turnover or twice the amount of wages and taxes per year.|
For a very small enterprise, small enterprise or entrepreneur, the amount of the loan may not exceed 50 percent of the amount of the eligible investment project costs; for a medium-sized enterprise - 40 percent of the investment project costs eligible for financing.
Maximum loan amount shall be EUR 3 million for a company (entrepreneur) and a group of companies (if the borrower belongs to a group of companies).
Incurred and planned expenses can be paid with the funds of the revolving loan no later than 8 months from the date of disbursement of this loan. Upon the expiry of the specified term, the unused amount of circulating loan funds must be returned to INVEGA by the recipient of this loan no later than within 10 business days.
In order to properly assess the risk of non-repayment of the loan, INVEGA shall have the right to request additional documents and explanations.
Interest on loans
Interest for negotiable loan shall be as big as is indicated in the table of interest rates provided below, and plus:
- 2.9% on loans amounting for up to EUR 1 million;
- 2.46% on loans from EUR 1 million.
Investment loans shall be subject to a fixed annual interest rate depending on the term of the investment loan.
|Negotiable loans||Investment loans|
|Purpose of the loan||Loan funds can be used to pay expenses incurred but not yet paid as of 1 October 2020, and expenses planned to be incurred, but no later than within 8 months from the date of disbursement of the negotiable loan. After the expiry of the specified term, the unused amount of negotiable loan funds must be returned to INVEGA by the recipient of the negotiable loan no later than within 10 business days. The recipient of the negotiable loan shall be responsible for the proper use of the negotiable loan in accordance with the purpose specified in the negotiable loan agreement. Settlements with negotiable loan funds shall be carried out only by payment orders.||Loan funds may be used to finance the acquisition of tangible non-current assets (buildings, devices, machines and equipment, vehicles specified in Clauses 5.1-5.7 of the Section "Unfinanced Expenses or Ineligible Expenses"), including the reconstruction of one's own tangible non-current assets, as well as the purchase of land, when the investment in the acquisition of land is directly related to the production and provision of services of the planned products (goods) and/or intangible non-current assets (assets that do not have a physical or financial form, such as patents, licences, or other intellectual property). The beneficiary of the investment loan shall be responsible for the proper use of the investment loan according to the purpose specified in the investment loan agreement. Settlements with investment loan funds shall be executed only by payment orders.|
|Collateral||May be applied (when the application for a negotiable loan was submitted from 22 April 2022 inclusive) or applied (when the application for a negotiable loan was submitted by 21 April 2022 inclusive) is the part that exceeds EUR 1 million when summing up the financing received and/or received under the measure "Direct COVID-19 Loans" and under the measures "Loans for Businesses Most Affected by COVID-19", "Loans for Tourism and Catering Service Providers", "Payable Accounts Loans", "Business Assistance Fund". Read more in the description of the measure.||A financed non-current asset or other equivalent non-current asset must be pledged in favour of INVEGAS. If, during the assessment of the application, a higher risk of (non)implementation of the investment project and/or non-repayment of the investment loan is identified, INVEGA shall have the right to demand additional collateral.|
|Loan deferral period||6 months + 6 months with INVEGA's consent.||Up to 24 months|
|The loan is granted||Only after submitting three certificates of refusal to provide financing to a business entity to INVEGA, signed by financial institutions and stating that the borrower is not provided with financing under the conditions specified in the certificate of refusal to finance the business entity. In all cases, at least one certificate must be submitted signed by a licenced bank of the Republic of Lithuania (or a branch of an EU/EEA licenced foreign bank established in Lithuania) and at least one by a financial company as defined in the Republic of Lithuania Law on Financial Institutions. Three certificates of refusal to finance a business entity through the electronic application system must be submitted to INVEGA within 30 business days from the date of receipt of INVEGA's request to submit them.||
Only after submitting three certificates of refusal to grant financing to a business entity (in all cases, at least one certificate must be submitted signed by a licenced bank of the Republic of Lithuania (or a branch of a licenced foreign bank established in Lithuania in the EU/EEA) and at least one from a financial company as defined in the Republic of Lithuania Law on Financial Institutions) from of different financial institutions (shall apply only if the investment project is planned to be financed only by the instrument and the borrower's own funds, i.e. without co-financing by financial institutions).
For an investment project that complies with the "do no significant harm" principle as defined in Article 17 of Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088, taking into account the technical guidelines for the application of the principle of doing no significant harm according to the Recovery and Resilience Facility Regulation approved by the European Commission's notification of 18 February 2021 No. 2021/C 58/01. Compliance with this requirement shall be assessed based on the questionnaire filled out by the beneficiary of the investment loan and submitted to INVEGA on the principle of "do no significant harm" (Annex 3 of the description).
An application for a loan can be submitted if:
- You are a small or medium-sized enterprise (SME) or a large enterprise (for negotiable loan only).
- Your main economic activity is included in the List. Compliance with this requirement (the code of the main economic activity of the borrower) shall be assessed on the basis of STI information at the date of application.
- You are registered in the Register of Legal Entities (company) or began to carry out activities (entrepreneur) no later than by 31 December 2020.
- You operate in the Republic of Lithuania.
- You meet the minimum criteria of reliable taxpayers.
- You are not a bankrupt and/or restructured company or an entrepreneur who has filed for bankruptcy of a natural person.
- You have submitted to the Centre of Registers a set of financial statements for 2019 and 2020, in which the composition of the equity capital would be disclosed in detail. Reports for 2019 are not submitted if you started operating on 1 January 2020.
- You have not received illegal aid, which was recognised as illegal and incompatible with the internal market by the decision of the European Commission, or you have returned its full amount, including interest, in accordance with the procedure established by law.
- You are not a state and municipal enterprise in which 25 percent or more of the capital shares or votes of the participants are held separately or jointly by the state and/or municipality.
- You have provided evidence (3 certificates) that financial institutions have refused to grant you a loan of the appropriate amount (in the case of an investment loan, it shall apply if the investment project is planned to be financed only by the instrument and the borrower's own funds, i.e. without co-financing by financial institutions). Certificates must be submitted after INVEGA assesses the application. The loan beneficiary shall be sent to the e-mail address indicated in the application in the form of a refusal to finance the business entity formed by INVEGA. The borrower must submit three certificates of refusal to finance the business entity to INVEGA, signed by financial institutions, that the financing is not provided to the borrower under the conditions specified in the certificate of refusal to finance the business entity. In all cases, at least one certificate must be submitted signed by a licenced bank of the Republic of Lithuania (or a branch of an EU/EEA licenced foreign bank established in Lithuania) and at least one by a financial company as defined in the Republic of Lithuania Law on Financial Institutions. Three certificates of refusal to finance a business entity through the electronic application system must be submitted to INVEGA within 30 business days from the date of receipt of INVEGA's request to submit them.
- In the case of a negotiable loan, you do not carry out activities or, in the case of an investment loan, the investments shall not go to activities in the financial, agricultural, forestry, fisheries and aquaculture sectors.
- You have provided all the required documents.
- In the business plan, you justify the need for a loan and, in the case of an investment loan, the economic feasibility and profitability of the investment project.
- The risk of default of the borrower and/or its loan is at an acceptable risk level, according to the methodology approved by INVEGA.
- Sanctions (any trade, economic or financial sanctions, embargoes or other restrictive financial instruments) are not applied to the borrower and its beneficiary, or to natural persons and legal entities for whose benefit the loan shall be used.