Despite the tough economic climate, at least one financial institution has no complaints about customers not repaying their loans.
And Axcel Finance has encouraged other finance companies to continue lending but practice due diligence.
Speaking to Barbados TODAY this morning, Axcel’s general manager Ricky Went said it was financial prudence that had helped them avoid customers who default on payments.
Went admitted that, generally, Barbadians proved to be very responsible people but said the company found that by engaging in due diligence they were able to avoid the high levels of nonpayment that several banks and credit unions experienced.
“We are seeing less delinquency for the most part because we are very thorough . . . trying to get people to borrow only as much as they can manage. If you are not doing that, you are irresponsible and what you are clearly not doing is helping people to get to that next step. You don’t want to tell people exactly what to do but you want to give people an option. We just don’t want to be putting people into more debt unnecessarily; we don’t want you to be over indebted. So there are times when you have to say to a client, ‘you are not in a position to take a loan from us or anybody at this stage, just keep it tight’, even if that means we are not going to meet our growth target,” he said.
Axcel Finance was established in Barbados just under a year ago. It currently has businesses in four other Caribbean countries.
Went highlighted the importance of financial institutions continuing to lend to their customers, particularly small businesses.
He told Barbados TODAY that on most occasions the working capital was what took these businesses to the next level and without it they were unable to expand.
“Most [small] businesses . . . don’t have a big track record like the established and national businesses, but a Microsoft would have never been here today if they couldn’t get access to financing. That is why we are trying to assist in everywhere we can,” he said.
Went said that in addition to working with companies, even those that do not have a business plan, Went said Axcel also has a financial literacy programme designed to help people to understand how to be prudent and exercise good judgment in borrowing and lending.