Loans
Special-purpose Loans
The SME Unit actively promotes Special-purpose Loans that have been instituted to support the implementation of government policies from the financial side.
Taking into consideration changes in the economic and social environments, policy issues of the day and the needs of SMEs, steps are taken to flexibly establish innovative Special-purpose Loans and to improve or eliminate existing products as considered necessary.
Among the Special-purpose Loans recently created by the SME Unit are: "Loans to Foster Growth of New Businesses" targeting forward-looking SMEs to support their innovative undertakings in tune with socioeconomic trends; "Rechallenge Support Loans" aiming to support once-failed entrepreneurs striving to take up the challenge of recovery; "Loans to Promote New Business Activities" to support SMEs' endeavors for management innovation, new alliance establishment and effective utilization of regional resources; and "Loans to Boost Corporate Vitality" to support client endeavors geared toward enhancement of manufacturing technologies.
Furthermore, in its active efforts to promote Special-purpose Loans that assist SMEs to adapt smoothly to rapid fluctuations in both economic and financial environments, the SME Unit offers such products as "Safety Net Loans" that help to fulfill its role as a safety net for SMEs, "Corporate Revitalization Loans" that support SMEs striving to revitalize their operations, and "Great East Japan Earthquake Recovery Special Loans" designed to support recovery from damage caused by the Great East Japan Earthquake.
Main Schemes
| Name | Eligibility | Max. amount fordirect loans |
Max. loan period | |
|---|---|---|---|---|
| Loans to Foster Growth of New Businesses (Note) | Companies that have undertaken newor businesses with high potential within the past seven years. | ¥600 million | (Facility funds) | 15 years |
| (Operating funds) | 7 years | |||
| Support Funds for Female and Young/Senior Entrepreneurs | For women, young people (aged under 30) and seniors (aged 55 and over) generally within seven years afterstart-up. | ¥720 million | (Facility funds) | 20 years |
| (Operating funds) | 7 years | |||
| Rechallenge Support Loans (Note) | Falled entrepreneurswanting to make another attempt. | ¥720 million | (Facility funds) | 20 years |
| Special quota of ¥300 million | (Operating funds) | 15 years | ||
| Loans to Promote New Business Activities | Companies whose plan has beenapproved as a "Business Innovation Plan," companies that are part of analliance relating to an accredited project under a "New Alliance Plan," andcompanies whose plan has been accredited as an "Agriculture, Commerce andIndustry Collaboration Plan" or a "Regional Resources Utilization- orientedBusiness Plan." | ¥720 million | (Facility funds) | 20 years |
| (Operating funds) | 7 years | |||
| SME management strengtheniing fund | Corporations/Individuals who formulate a business plan for new business activity, and are receiving support form Organizations Supporting Management lnnovation | ¥720 million | (Facility funds) | 15 years |
| (Operating funds) | 7 years | |||
Note: Available only in the form of direct loans.
| Name | Eligibility | Max. amount fordirect loans |
Max. loan period | |
|---|---|---|---|---|
| Loans to Boost Corporate Vitality | Companies in the wholesale,retail, services, warehousing and freight trucking industries, etc. that plan to make specified capital investments, andcompanies seeking enhancement of their core manufacturing technologies. | ¥720 million | (Facility funds) | 20 years |
| (Operating funds) | 7 years | |||
| Loans to Promote IT Use | Companies planning to makeIT-related investments to cope with changes in business environment due todevelopment of IT. | ¥720 million | (Facility funds) | 15 years |
| (Operating funds) | 7 years | |||
| Loans for Overseas Investment | Companies that engage in overseasbusiness development in their efforts to adapt to structural shifts in the economy. | ¥720 million | (Facility funds) | 15 years |
| (Operating funds) | 7 years | |||
| Loans for Regional Revitalization and Employment Promotion | Companies making capitalinvestments that are expected to produce a certain number of jobs indesignated regions and companies that have received approval for a "BusinessLocation Plan." | ¥720 million | (Facility funds) | 20 years |
| (Operating funds) | 7 years | |||
| Loan Program for Entities Adopting "Accounting Guideline for Small and Medium-sized Entities" | Companies following "Accounting Guideline for Small and Medium-sized Entities" | ¥720 million | (Facility funds) | 15 years |
| (Operating funds) | 7 years | |||
| Name | Eligibility | Max. amount fordirect loans |
Max. loan period | |
|---|---|---|---|---|
| Environment and Energy Measures Loans | Companies planning to installenergy conservation equipment or designated pollution control equipment. | ¥720 million | (Facility funds) | 20 years |
| (Operating funds) | 7 years | |||
| Funds to Construct Facilities to Deal with the Social Environment(Note) | Companies developing facilities that willcontribute to disaster management based on their own BCPs | ¥720 million | (Facility funds) | 20 years |
| (Operating funds) | 7 years | |||
Note:Available only in the form of direct loans
| Name | Eligibility | Max. amount fordirect loans |
Max. loan period | |
|---|---|---|---|---|
| Loans to Deal with Changes in the Business Environment (Note) | Companies suffering from temporarydecline in sales or deteriorating profitability | ¥720 million | (Facility funds) | 15 years |
| (Operating funds) | 8 years | |||
| Loans to Deal with Changes in the Financial Environment (Note) | Companies suffering from temporarydeterioration of cash flow due to changes in conditions oftransactions with financial institutions. | Special quota of ¥300 million | (Facility funds) | 15 years |
| (Operating funds) | 8 years | |||
| Loans to Respond to the Bankruptcy of Trading Partners | Companies suffering fromdeterioration of cash flow due to bankruptcy of related companies. | Special quota of ¥150 million | (Operating funds) | 8 years |
Note: Available only in the form of direct loans.
| Name | Eligibility | Max. amount fordirect loans |
Max. loan period | |
|---|---|---|---|---|
| Loans to Support Business Revitalization (Note) | Early DIP Companies that have filed apetition to initiate rehabilitation procedures under the Civil RehabilitationLaw, approval for which is still pending. |
¥720 million | 1 years | |
| Later DIP Companies whose rehabilitationplans have been approved under the Civil Rehabilitation Law. |
(Facility funds) | 10 years | ||
| (Operating funds) | 5years | |||
| Loans to Support Corporate Rebuilding/Accession of Bankrupt Business (Note) | Companies undergoing management improvementor Business turnaround | ¥720 million | (Facility funds) | 20 years |
| (Operating funds) | 15 years | |||
| Companies that have acceded the operations of bankrupt business and companiesacquiring equity capital from shareholders. | (Facility funds) | 15 years | ||
| (Operating funds) | 7years | |||
Note: Available only in the form of direct loans.
| Name | Eligibility | Max. amount fordirect loans |
Max. loan period | |
|---|---|---|---|---|
| Great East Japan Earthquake Recovery Special Loans (Note) | Companies that sustained damage from the Great East Japan Earthquake | Special quota of ¥720 million | (Facility funds) | 20 years |
| Special quota of ¥300 million | (Operating funds) | 15 years | ||
Note: Available only in the form of direct loans.
◇In addition to the above, the Loans for Disaster Recovery financing program is also available.
For details of specific requirements, special interest rates, and other matters, please inquire at a Loan Office.
Loans That Do Not Excessively Rely on Real Estate Collateral or Guarantors
Loans That Do Not Excessively Rely on Real Estate Collateral
In providing to its customers Special-purpose Loans, the SME Unit recognizes machinery and equipment, inventories and intellectual property rights as collateral. At the same time, the SME Unit continues to adopt an increasingly flexible approach through the introduction of "no-collateral provision."
Guarantor Provisions
The SME Unit maintains various guarantor provisions that accommodate the wide-ranging needs of its mainstay SME customer base. In addition to the "no-guarantor provision," the SME Unit has expanded its "personal guarantee postponement provision," which allows a company CEO to postpone the issuance of his or her personal guarantee subject to certain predetermined terms and conditions.
| No-guarantor provision | Personal guarantee postponement provision | |
|---|---|---|
| Eligibility | Those planning to use direct loans. (Eligibility requirement: applicant must undergo credit analysis in respect to business outlook, etc.) | Those planning to use direct Special-purpose Loans. (Eligibility requirement: applicant must undergo credit analysis in respect to business outlook, etc.) |
| Outline of provision |
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Note: Companies that have taken out Loans to Foster Growth of New Businesses (excluding some funds) are exempt from the loan interest rate under this program if certain conditions are met.
Capital Loans & Subordinated Loans
In order to boost the financial structures of SMEs that are endeavoring to cultivate new businesses or implement corporate restructuring, the SME Unit introduced the "Provision Scheme for Challenge Support and Capital Enhancement" (capital loans) in fiscal 2008, "Special Disaster Recovery Support Capital Enhancement" in fiscal 2011, and "Special International Development Subordinated Loans" in fiscal 2012.
| Eligibility | Companies that are utilizing Loans to Foster Growth of New Businesses or Loans to Support Business Revitalization (excluding some schemes) in the form of direct loans and companies that have been recognized as having a specific effect on employment (creating new employment or maintaining employment), providing business that is essential to the local community, or enterprises with a high level of technical capabilities in order to revitalize the regional economy. (Use of the scheme requires examination of financial details, business outlook, and other factors by the SME Unit.) | |
| Outline of provision | Maximum amount | ¥300 million per company |
| Interest rate | Three interest rate bands are applied according to the degree of success in the most recent fiscal year during each year after the loan is made. Revitalization 15-year loan: 6.35%, 4.40%, 0.40% 10-year loan:6.25%, 4.30%, 0.40% 7-year loan: 6.20%, 4.25%, 0.40% New business 15-year loan: 6.30%, 4.55%, 0.40% 10-year loan: 6.00%, 4.30%, 0.40% 7-year loan: 5.65%, 4.05%, 0.40% |
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| Loan period | 15 years・10 years or 7 years(lump-sum repayment on maturity) | |
| Collateral/Guarantor | No collateral/no guarantor | |
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| Eligibility | Companies utilizing the Great East Japan Earthquake Recovery Special Loan program (in relation to direct earthquake damage). (Use of the scheme requires examination of financial details, business outlook, and other factors by the SME Unit.) | |
| Outline of provision | Maximum amount | ¥720 million regardless of existing loan balances |
| Interest rate | Two interest rate bands are applied according to the degree of success in the most recent fiscal year during each year after the loan is made. 3.60％、0.40％ |
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| Loan period | 10 years | |
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| Eligibility | Companies that utilize international development financing under the Loans for Enhancing Corporate Vitality program for the purpose of investment in overseas companies. (Use of these schemes requires analysis of financial details, business outlook, and other factors by the SME Unit.) | |
| Outline of provision | Maximum amount | ¥200 million per company |
| Interest rate | 3.15% or 4.20% in the case of a 7-year loan, 3.40% or 4.35% in the case of a 10-year loan, and 3.80% of 4.50% in the case of a 15-year loan | |
| Loan period | 15 years, 10 years, or 7 years | |
| Other | Debt under this provision is subordinate to all debts in the event of a decision with regard to legal bankruptcy proceedings in a court of law (excluding debts that are equivalent or lower in precedence). | |
| Remarks |
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| Eligibility | Companies that utilize loans to deal with changes in the business environment, loans to deal with changes in the financial environment, Great East Japan Earthquake Special Recovery Loans or Corporate Revitalization Loans for corporate reorganization, or Business Succession Support Loans. (Use of the scheme requires examination of financial details, business outlook, and other factors by the SME Unit.) | ||
| Outline of provision | Use of funds | Includes the refinancing of existing JFC loans. | |
| Interest rate |
Note: Calculated based on the rate of interest stipulated under the loan contract (as of April 1, 2011, the rate applicable in the event of a breach of the conditions). |
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| Loan period | Safety Net Loan Program Great East Japan Earthquake Special Recovery Loans |
8 years or less (in principle grace period of one month or less) | |
| Corporate Revitalization Loans | 15 years or less (in principle grace period of one month or less) | ||
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Five-Yearly Interest Rate Review Option & Early Repayment Charge
Five-Yearly Interest Rate Review Option
The borrower may choose to pay interest to maturity at the same rate agreed upon at the time of contract, or to pay interest at a rate that is reviewed every five years.
Early Repayment Charge
In the event that the borrower opts to repay all or part of the loan prior to maturity, an early repayment charge will accrue.
Note: Early repayment is only allowed with the SME Unit's approval, and payment of the early repayment charge.
Securitization of Loan Claims and Corporate Bonds (CDO Program)
Since July 2004, the SME Unit has provided unsecured funds by means of loans or corporate bond underwriting premised on the issuing of asset-backed securities in the form of collateralized loan obligations (CLOs) or collateralized bond obligations (CBOs).
