The Emergency Humanitarian Aid Scheme will be made available to small businesses, sports clubs, community and voluntary organisations with fewer than 20 employees that could not secure flood insurance and have premises that have been damaged.
The first stage will begin immediately and will provide a contribution of up to €5,000, depending on the scale of damage incurred.
Mr Varadkar said the scheme was designed to provide urgent help to those who have not been able to secure insurance through no fault of their own. “This flood damage is devastating for the people of Cork and comes after what has been an exceptionally difficult year for business owners and their staff,” he said.
Earlier, Taoiseach Micheál Martin said that the Government would ensure supports are provided to the businesses affected.
Mr Martin said: “This latest flood event is deeply distressing for business owners in the city.
"This is a critical time for traders, and they are now facing into another clean-up operation following this morning’s flooding.
“Myself and my Cabinet colleagues discussed the situation in Cork and agreed that all the necessary supports will be made available to those affected by this morning’s floods.
“We will ensure that these schemes are activated without delay. I would encourage business owners to apply for the funding which is being made available to them.
“Today’s flood event, which has caused damage estimated to run into millions of euro, is further evidence of the need to progress flood defence works in the city to prevent such flooding occurrences in the future," he added.
Many businesses and shops in the city were left under a metre of water after significant flooding hit several streets overnight.
Business owners were counting the cost of sudden flooding following Tuesday morning’s high tide.
Despite flood warnings issued on Monday, many struggled to protect properties because of the speed at which the floodwater rose.
The flooding came hours after the Government announced plans for the country to go into a Level 5 lockdown for six weeks.
Beer kegs getting carried downstream...
This is Not a drill, if you own a city business..get in here..#pembrokestreet #corkflood pic.twitter.com/WYNtwMfn5W— Richard Jacob (@IdahoNua) October 20, 2020
Cars left on a number of streets overnight were badly damaged.
Video footage posted on social media showed beer kegs floating down Pembroke Street in the city.
Other streets affected by the flooding included South Mall, Princes Street and Oliver Plunket Street.
Local Sinn Féin TD Donnchadh O Laoghaire tweeted: “Heartbreaking footage from the city centre this morning.
“The last thing businesses and residents needed right now.
“Flooding in South Parish, Carrigaline and Passage as well.
“The two councils and OPW must ensure all supports possible are made available to those affected.”
Co Cork has been hit by a number of floods over recent months, particularly in west Cork where widespread damage was caused to businesses and properties. – Additional reporting: PA
