Société Nationale de Crédit et d'Investissement

Société Nationale de Crédit et d'Investissement or SNCI is a public-law banking institution in Luxembourg City designed to encourage business investments, start-ups and research initiatives. Founded in 1978, it is wholly owned by the State of Luxembourg.

The banking services offered by SNCI include medium and long term financing for investments made by Luxembourg-based companies, including Luxembourg companies operating abroad, and start-up loans for small and medium-sized enterprises. SNCI also provides loans for financing professional equipment including equipment for safety or environmental protection. It also offers innovation loans for research-and-development programmes or projects of industrial enterprises and service providers; foreign investments financing; and equity loans for limited liability companies. On average, SNCI loans cover some 25% of investments in fixed assets for industrial projects while up to 75% of eligible start-up investments can be covered for young craftsmen, traders, hoteliers or restaurant owners.

Equipment loans are for investments relating to the creation, extension, reorientation or takeover of Luxembourg SMEs in the skilled-craft, commercial, hotel or industrial sector. They are granted by decision of the SNCI Board of Directors, via an authorized bank, for financing intangible assets (patents, licenses or software), tangible assets (equipment for the production or provision of services) and land, buildings or parts of buildings to be used for professional purposes. The fixed-rate loans, with a duration of 10 years and to be reimbursed on a quarterly basis, usually start at €12,500 and may not exceed €2.5 million. They normally cover from 25 to 60% of eligible costs (75% for a first business) depending on the sector.

Start-up loans, designed to encourage new entrepreneurs to create or acquire SMEs, can cover the financing of business plans, land and buildings to be used for professional activities, working capital, equipment, intangibles (licences, software), and start-up activities (advertising, studies). Support ranges between €5,000 and €250,000 but may not exceed 40% of eligible costs. The interest rate is currently fixed at 5.25%. The duration is decided on a case-by-case basis depending on the nature of the costs. Reimbursement at quarterly intervals must start within five years but repayments can be made earlier without penalty.

Medium-term and long-term loans can be granted to industrial enterprises and service providers, with equity of at least €25,000, for financing tangible and intangible assets and for land to be used for professional purposes. Projects to be financed must have a value of at least €100,000. Loans are usually for 25 to 30% of the investment. They start at €25,000 and may not exceed €10 million unless ministerial authorization is received. Interest is at the "SNCI prime rate" at the time the loan contract is signed and is free of commissions and additional charges. The rate is fixed by the SNCI's Board of Directors on the basis of the refinancing costs. Medium-term loans are for five years, long-term loans for six to 10 years. They are to be repaid in fixed quarterly payments.