Loan conditions

The maximum loan period for a R&D loan or a subordinated capital loan is 10 years. The first five years can be a period of grace before repayment of the principal begins

Conditions for R&D loans:

  • the interest rate is three percentage points below the base rate of interest; notwithstanding this, the minimum rate is 1.0 per cent
  • the loans are usually granted with no requirement of collateral

Conditions for subordinated capital loans (for R&D and for establishing a new business):

  • The loan period begins from the drawing of the first part of the loan. The actual loan period will be longer than stated, since the maturity date is tied to the end of the borrower’s financial year and not to the date on which the first part of the loan is drawn.
     
  • The interest rate of R&D loan is one percentage point below the base rate of interest; notwithstanding this, the minimum rate is 3.0 per cent. The interest is payable as of the date on which the loan or a part of it is first drawn. The interest calculation period is the financial year. The interest for a start-up loan is the base rate valid at any given time, however, always at least four per cent.
     
  • The loan recipient will only pay interest on the loan capital if the institution that has raised the loan has an equivalent amount of distributable assets. However, interest on the loan will also accumulate during the review periods in which the confirmable financial statements show no distributable assets (applies to loans granted during the validity of the previous Limited Liability Companies Act (734/1978).
     
  • The borrower shall repay any of the capital only if full cover remains for the restricted equity of the institution taking out the loan (applies to loans granted during the validity of the previous Limited Liability Companies Act 734/1978).
     
  • The borrower shall repay the interest and capital only in so far as the amount of free equity and all the capital loans of the institution taking out the loan exceed at the payment time the amount of loss verified for the company’s latest full financial period or included in a more recent financial statement in accordance with the balance sheet (applies to loans granted during the validity of the new Limited Liability Companies Act (624/2006) which came into force on 1 September 2006).
     
  • If part or all of the principal or interest on a capital R&D loan has not been repaid by the end of the loan period for the above reasons, the loan period will be prolonged until the entire loan has been paid back.
     
  • Capital R&D loans are in principle granted without the requirement of collateral.

The following templates are used for loans granted after 1 September 2006 by Business Finland (formerly: Tekes):

Product development loan note 3035- (pdf)
Subordinated product development loan note 3037- (pdf)
Subordinated establishment loan note 3038- (pdf)

Published 2012-11-23 at  14:44 , updated 2017-12-29 at  14:03
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