– as SBB ramps up procurement programme
– $1B disbursed over the past 4 years, $10M for grant fund

EVERY small business which is capable of satisfying the needs of a government project would be able to successfully bid and have the same opportunities as the large businesses, said Chief Executive Officer (CEO) of the Small Business Bureau (SBB), Dr. Lowell Porter.

The constitution makes provision for small businesses to enjoy 20 per cent of the government procurement but the law was not enforced over the years. “Every small business that is capable must have a bite… from next year businesses will not only benefit from the 20 per cent procurement but they will be able to benefit from all contracts starting January next year,” said Porter, during a press conference at SBB on Tuesday.

In order to benefit from the programme, businesses would need to be registered with the SBB and be approved as a supplier. “We will do proper screening to ensure that the bigger businesses do not pose as small businesses,” said Dr. Porter, adding that they thoroughly screen and do site visits for businesses which approach the SBB.

Around the world, most small businesses which start, fail within two years, but according to SBB 78 per cent of their clients which started five years ago are still in business. This proves that the local small businesses are capable and efficient.

Over the past four years, the bureau has facilitated the disbursement of over $1 billion in loans to proprietors. Dr. Porter said the delinquency on loans is low, primarily because of the partnership between small businesses and the SBB.

He said there is a .5 (point five) per cent delinquency on small business loans because the SBB works with businesses to stay in the “paying mode.”

“The SBB does not lend any money, we work along with two commercial banks- Republic Bank and GBTI- which do the lending and although the delinquency rate is low, the rejection rates are high… only 50 per cent of the loans are approved,” said the Dr. Porter.

The CEO believes that many clients are rejected because they cannot provide documentation which justifies their ability to repay the loan.

Commercial banks were urged to be more favourable to small business financing going into the next year.

According to Dr. Porter, it is a similar case for the disbursement of grants. There is an external grant committee which approves and rejects grants.

This year $10 million was allocated to the grant fund but, as seen in previous years, not everyone would be able to benefit from grants.

“I think the time has come to focus on businesses which have the potential to contribute to the Gross Domestic Product (GDP),” said the Dr. Porter.