Eight out of ten borrowers from the Trust Loan, the Government’s signature small business lending programme, are keeping up their payments on their startup business loans amounting to just over $12 million, Minister of Small Business Dwight Sutherland has revealed on the eve of the fund’s first anniversary.
Sutherland told Barbados TODAY that to date, the fund has handed out 2,700 loans and while the programme is striving for 100 per cent compliance, he is heartened that the majority are keeping up with payments.
He said: “In all systems, there are the persons who would default but we have a process in place where we are trying to minimize the rate of default and this seems to be working well.
“We have a default rate of just under 20 per cent and I think this is a remarkable achievement by the staff as well as those who have accessed the fund,”
He pointed out that the low default rate was achieved despite having limited manpower to follow-up with borrowers.
Sutherland added: “Most players in the micro-lending industry have 20 to 25 persons employed, but I can say to you that the Trust Loan programme has significantly less than that.
“In fact, the number of employees at the Trust Loan Unit are less than ten and to achieve 2,700 loans being disbursed at a value of $12.3 million, in less than a year, is remarkable.”
The Minister said the lending unit was using mobile technology to ensure greater compliance, starting with making it easy for loan recipients to make their payments.
He told Barbados TODAY: “We have also instituted some information and communication technology at the Trust Loan where persons can pay via their credit card and via their smartphones, as well as through SurePay and Cave Shepherd.
“We have ensured that the process is digitized so that it is easy for everyone to make payments and I must say that this is going quite well.”
But Sutherland revealed that there was still a substantial number of people waiting in line to access the fund and more would-be borrowers are being added to this list daily. He insisted that no one who qualifies for the loan will be left out.
He declared: “We have some 1,300 persons waiting for loans, which would mean another $6 million in funding and those persons will be processed in the same manner that the others before them were.
“People are coming every day to the Trust Loan Unit, so this programme, once we continue to train persons and hold their hand, is going to continue to thrive and empower persons, who are trying their best to get their businesses off the ground.”
The Minister revealed that the fund has also helped 21 people with disabilities to received financing for their business ventures.
Sutherland said: “We believe that not because persons are disabled means that they can’t run a business.
“We have also given priority to persons who would have been retrenched and we are ensuring that they get their lives back on track.” [email protected]
