Pre-announcement – Launch of the FSMA+
Following the success of the Further Studies Made Affordable (FSMA) scheme, through which to-date 219 students were able to undertake specialised studies in various disciplines, the Managing Authority (MA) has secured EU financing which will be directed to the Malta Development Bank (MDB) to implement a new scheme, the FSMA+. The Scheme will be funded from the European Social Fund (ESF) and the European Social Fund Plus (ESF+).
A new call for service will shortly be issued by the MDB, inviting commercial banks to submit a proposal as financial intermediaries of the FSMA+ scheme.
The new scheme will build on the success of its predecessor which the MDB, in collaboration with the Managing Authority of EU funds, had launched in October 2019.
Thanks to the ESF and the ESF+ Programme, up to €5 million will be dedicated to support the FSMA+ scheme. Close to half of this amount will be in the form of a grant subsidising the interest payments during the moratorium period. The MDB will again provide a First Loss Guarantee covering 80% of individual loans, capped at 25% of the commercial bank’s portfolio, generating a multiplier of 5, meaning that a total portfolio of circa €15 million will be made available.
Like its predecessor, this scheme will allow the provision of affordable loans for students, with the FSMA+ allowing loans of up to €100,000 for a duration of up to 15 years, including a maximum moratorium period of 5 years. Similarly, students will once again benefit from a subsidy on all the interest payments during the moratorium period which is being financed through a grant, and an attractive interest rate thereafter. Due to the guarantee of 80% provided by the MDB, no collateral or up-front contribution will be requested from the beneficiaries.
Prof Josef Bonnici, Chairman of the MDB said: “We are pleased to have secured the necessary funding to build on the success of the FSMA into a new scheme. By enhancing access to student loans, the MDB will be supporting the upskilling of Malta’s youths and labour force allowing them to move on to better jobs and strengthening Malta’s human capital”.