Small and micro enterprises to benefit from interest rate reduction this year

SMALL and micro enterprises (SMEs) in priority areas of the low carbon sector, such as fruit and vegetable farming and processing, aquaculture, eco-tourism, sustainable forestry and wood processing, business process outsourcing and bio-ethanol production, would benefit from an interest rate reduction this year.This is one of a number of means of tangible support the Government has extended to the SMEs to enable them to be important vehicles for advancing the economic viability of the individual and the economy, Finance Minister Dr. Ashni Singh said during his presentation of budget 2014 on Monday last.

Thus far, he said, over 30 loan applications for new and established entrepreneurs are currently being assessed and processed by the partner financial institutions in areas such as bio-plastics, agriculture, ecotourism, crafts, entertainment, and manufacturing; and over 2,200 jobs are expected to be created and sustained.

He stressed that the registration of existing SMEs in the national database, to be undertaken this year, will be a crucial step for ensuring that people are eligible for Government financing and support.

Dr. Singh said that, in targeting SME development, Government has sought to ensure greater access to affordable financing through three new facilities, namely the Credit Guarantee Fund, a Low Carbon Grant Scheme, and an Interest Payment Support Facility.

Under the Credit Guarantee Fund, resources were and will be provided for up to 40 percent of the collateral requirement of any loan to a maximum of $12 million.

The Low Carbon Grant Scheme will provide a maximum of $300,000 per applicant as a grant or partial grant to set up or expand businesses in a low carbon sector, and can be used for such things as equipment upgrade, technological innovation, or for legal and regulatory standards’ compliance, research and development and marketing.

The Interest Payment Support Facility would provide reductions on interest costs to existing loans.
He said that, in 2013, a sum of $360 million was expended in support of these three SME financing sources and on conducting public awareness campaigns, and on designing a monitoring and evaluation system and a management information system.

In 2014, the sum of $212.6 million is allocated to continue these facilities.

In 2013, in the area of capacity building, approximately 340 entrepreneurs benefitted from business development and technical skills training, including basic business management skills, record keeping, and packaging and labelling.

In 2014, over 1,000 persons will be trained in business development and technical skills, such as record keeping, market research, entrepreneurship, and other relevant areas.

In 2014, 40 outreach programmes will be conducted countrywide to explore the potential for networking, and SME clusters will meet the demand of the supply chain and address the issue of economies of scale.

Through this initiative, the incomes of 1,000 new and 2,185 existing small and medium entrepreneurs will be significantly boosted.

Government will also undertake a study to identify and map SME clusters across the country, and support marketing both locally and internationally through exhibitions, trade fairs, conferences, skills matching, and business advisory services.
With respect to the registration of existing SMEs in the national database, a management information system will be established and an additional 1,200 small businesses are expected to be added to the national register, thereby increasing the number of small businesses registered to 3,385.

With this crucial information, he said, Government will be better able to effectively plan the scale of its intended interventions to SMEs.

SHARE THIS ARTICLE :
Facebook
Twitter
WhatsApp

Leave a Comment

Your email address will not be published. Required fields are marked *

All our printed editions are available online
emblem3
Subscribe to the Guyana Chronicle.
Sign up to receive news and updates.
We respect your privacy.