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Loan fund still providing financing assistance for small businesses

by Marlon Madden
4 min read
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The man in charge of the fund set up almost two years ago to assist operators in the micro, small and medium-sized enterprise (MSME) sector has dismissed claims that it has been stopped.

General Manager of the Trust Loan Fund Gerry Amos told Barbados TODAY the slow down in disbursement in recent times was due to the fund being more strategic by offering more “emergency loans” to help businesses stay afloat, with a focus on the agriculture and manufacturing sectors.

In addition, Amos said leading up to the COVID-19 pandemic towards the end of March clients were repaying their loans.

He was responding to recent claims by Democratic Labour Party spokesman on small business Ryan Walters that the fund had “halted”.

Amos also dismissed claims by Walters that there was $40 million set aside for the Trust Loan Fund.

When the fund began in November 2018, Government had promised to finance it to the tune of $10 million per year.

Amos told Barbados TODAY that to date, it had received some $15 million – $10 million for its first year and $5 million so far this year.

Amos said he was certain the remaining $5 million for this year would come, but he was unable to say how soon.

With more than $13.6 million paid out to date to just over 3,000 applicants, and with beneficiaries paying back their loans, Amos said the fund remained capitalized.

“The Government is giving funds to the organisation albeit during this climate it is not as fast as it would come before as the financial year started. You must understand that in the current climate there are priorities. Not that micro business is not priority, but you have to be reasonable and understand what is happening,” he said.

During the height of the COVID-19 pandemic here borrowers were given a three-month moratorium. They are also given a grace period before they start their repayment.

“So remember we have done three-month moratorium and not getting any payments at all. So this must be recognized when we start to speak. Right now we do have over 3,000 clients and we are doing applications for emergency loans and focusing on the manufacturing and agriculture, and we will be reaching out to clients to help them rescue their businesses,” he stressed.

He said in association with the Ministry of Small Business, the fund was conducting visits to clients and promoting them, with plans to visit businesses in St John, St Philip and St George this week.

When pressed on whether the fund was experiencing financial difficulties, Amos explained that given the current economic climate Government’s finances were such that monies were not being distributed as they would have been done before.

“I would not say that the fund is not challenged financially, but we know that money is going to be coming. When it is going to be coming we are not sure, but as the general manager I am understanding of the current climate in the country and I understand the Prime Minister and the Cabinet are doing their best to try and finance the institution,” he said.

Stressing that the main aim of the fund now was to keep businesses open, Amos said there were several small businesses that “suffered” during the COVID-19 period and needed a further top up.

“We are trying to prioritize those businesses. Some people may ask why are we not helping new businesses? But the aim right now is to make sure that those businesses we have on our portfolio continue to succeed,” he said.

“I am not saying that the applications we have will not be receiving [loans]. All I am saying is that at this time our priority is to help those businesses that are already open,” he insisted.

He added that in addition to a focus on the agriculture and manufacturing sectors at this time “we are looking to do emergency loans for those persons we have identified who need to be rescued”.

Further pointing out that the fund had not halted or dried up, Amos said people were repaying their loan prior to the pandemic. The average repayment per month is about $150 per client.

“Actually, always bear in mind that there is a moratorium period before people start to repay. Just before COVID-19 we were having our strongest repayment period. In February and March we were doing extremely well and by mid-March we started to see a decline in payments but by then we were way ahead of what we were in February. But then COVID- came in and as expected, payments started to decline, and then from April onward we started to give a moratorium,” Amos explained.
marlonmadden@barbadostoday.bb

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