The councillor Rosario Sánchez presents the new line of credits with which 360 million have been approved for more than 4,000 companies and self-employed in the last three years.
During 2022, financing for investment has grown to 62% of the total, surpassing the level before the pandemic, and loans for business start-ups have increased as never before.
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ISBA credits
The new line of guarantees from ISBA SGR, with the support of the Government of the Balearic Islands, to facilitate access to financing under very advantageous conditions for companies and self-employed workers in the Balearic Islands, will make it possible to mobilise financing of up to 100 million euros this year. This new call gives continuity to the support channel for the business fabric, which has increased in the last three years, in the context of the COVID-19 pandemic and the effects of Russia’s invasion of Ukraine, with a total of 360 million in operations approved since 2020 for more than 4,000 companies and the self-employed.
The councillor of Finance and External Relations, Rosario Sánchez, today presented the new annual credit line accompanied by the president of the reciprocal guarantee company, Eduardo Soriano; the director general of the Treasury, Financial Policy and Assets of the Govern, Aina Galmés, and the director of ISBA, Jesús Fernández, and also presented the balance of activity for 2022. Last year, through ISBA, operations were approved for 964 companies and the self-employed for a total of 97.2 million, 22% more than in 2021. Of this volume of financing, 85.6 million had been formalised before the end of the year.
This year, during these first three months of the year, operations for an amount of 37.3 million have already been approved – 51% more than during the same period last year – for 375 companies and the self-employed. For this year 2023, the new ordinary line is now formally open, which allows both financing new investments (credits of up to 1 million euros) and receiving liquidity (up to 300,000 euros), and the special liquidity line launched last October, within the social shield to face inflation and the effects of the war, remains in force, initially until 31 May.
As highlighted by the councillor Rosario Sánchez and the heads of ISBA, the new line encourages business investment and especially subsidises transformative investments, those that contribute most to the improvement and diversification of the production model and to environmental, economic and social sustainability: in research and innovation, ecological and energy transition, digitisation, emerging sectors, projects linked to the sea and sustainability or water management, and other areas, such as the promotion of women’s entrepreneurship. The call offers 100% guaranteed operations and subsidies on the interest rate, the cost of the guarantee and the cost of opening and study. The line is co-financed by the European Union’s ERDF fund.
More investment and the creation of new companies
Last year, in a scenario of economic recovery, the demand for financing to start up new business investments continued to increase notably. Thus, during 2022, loans to finance investments have already accounted for 62% of the total number of operations formalised, a figure much higher than the 45% of 2021 and, especially, the 8% of 2020, when almost all operations were to provide liquidity to companies. The volume of resources for investment in 2022 was 53 million (+78% compared to the previous year), which is well above the level of the year before COVID-19 (32 million in 2019) and quadruples the investment figure for 2020 (13 million).
At present, according to the 2022 data, ISBA’s action helps to maintain 44,227 jobs in the Balearic Islands, 22% more than in the previous year, to a total of 3,842 companies and self-employed workers (8% more). Another highlight of 2022 is that it was the year with the highest number of operations aimed at the creation of new companies. This support for entrepreneurship has meant financing a total of 268 new projects, for a total amount of 22.6 million, 35% more than in 2021. Loans for entrepreneurs accounted for 31% of the operations guaranteed by ISBA last year. Within this aid, it should be noted that the self-employed accounted for more than half (54%) of the entrepreneurs guaranteed.
Aid on all islands and in all sectors
According to the 2022 data, the Government has earmarked an average of around 5,000 euros per company for financing operations. In addition, over the past year new operations were also approved to defer loan repayment deadlines, another very important measure after the pandemic and which, in three years, has approved the deferral of the repayment of 113 million euros to 1,250 companies through ISBA.
This support for companies and the self-employed reaches all islands and sectors. In terms of territorial distribution, in terms of access to new loans, the bulk of the operations approved last year corresponded to Mallorca, with a total of 80 million directed at 790 companies and the self-employed. In Menorca, 100 operations were approved for a total of 10.3 million, and in Eivissa and Formentera, 6.8 million in a total of 74 operations.
By sectors, in terms of volume of financing, those with the highest amounts in the 2022 balance sheet are industry (13.2 million), with 15% of the total volume of operations formalised; services (12.5 million), with the highest number of beneficiaries last year (169), and transport (10.6 million). Tourist accommodation (9.3 million), retail trade (8.8 million) and bars and restaurants (8.5 million) were the other sectors with the highest volume of financing granted through ISBA loans in 2022.