The Ministry of Economy and Innovation, in collaboration with ILTE, has reviewed the terms and conditions of financial instruments for businesses, totalling over 400 million euros and funded by European Union (EU) funds, and is preparing amendments to ensure that more funds are channelled towards the most actively utilised instruments. This will provide businesses with more opportunities to access preferential loans and expand their operations.
“Funds earmarked for business must reach companies as quickly as possible and be channelled into real investments. We have therefore reviewed the financial instruments and will propose the reallocation of 77 million euros from European Union funds so that more companies can benefit from the financial support provided by the state. We are increasing the proportion of the grant allocated to writing off the loan amount, expanding funding opportunities and reducing excessive requirements. We want as many Lithuanian companies as possible to be able to invest in expansion and new technologies,” says Edvinas Grikšas, Minister for the Economy and Innovation.
The reallocation of funds will cover three ILTE direct loan schemes – ‘Startuok’, ‘Pokytis’ and ‘Perspektyva’. Following a review of their results, it is proposed that some of the funds be redirected from less popular activities to those which businesses utilise more actively. The most significant changes are expected in the ‘Startuok’ and ‘Pokytis’ loan schemes, which aim to encourage businesses to launch new activities or to strengthen or expand existing ones, as well as to promote productivity growth, technological progress and digitalisation.
One of the most significant changes planned is an increase in subsidies, which will allow part of the loan amount to be written off, thereby reducing the financial burden on businesses.
Under the ‘Startuok’ scheme, the grant for investment loans would increase from 20 per cent to 30 per cent. Furthermore, businesses in the Capital Region would also be eligible to benefit from this scheme. ‘Startuok’ is aimed at small and medium-sized enterprises wishing to start or expand their business.
Under the ‘Pokytis’ scheme, the grant would increase from 10 to 30 per cent. The procedure for awarding grants would also be simplified – companies would be able to receive them once a project has been completed, without having to wait for the set targets to be achieved. This measure is aimed at industrial enterprises and micro, small and medium-sized enterprises (SMEs) investing in digitalisation, new technologies and the modernisation of their operations. It covers transformation activities in the Central and Western regions, as well as digitalisation and the creation of short value chains in the Capital Region and the Central and Western regions of Lithuania.
There are plans to expand the funding options. Under the ‘Pokytis’ scheme, funding could be provided not only for the automation of production but also for the automation of other business processes and the implementation of digital technologies. In the capital region, funding for digitalisation would become available to a wider range of businesses, as the requirement for high added value would be removed. Furthermore, companies in the capital region would be given the opportunity to obtain funding under the ‘Pokytis’ scheme to implement technologies and modernise business processes, thereby contributing to the creation of short value chains.
It is planned that the new funding conditions will come into force on 6 November, once the amendments to the financial instruments have been agreed with the relevant authorities. It is important to emphasise that the new conditions will apply to applications from businesses submitted after the amendments come into force.
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