Nearly $270m in loans facilitated by Small Business Bureau last year, 51% of target

-some medium, small scale operators not meeting banks borrowing requirements

Information released by the Small Business Bureau (SBB) last week indicates that during last year the agency facilitated a total of fifty loans to clients   valued at $269.7 million and up to November 30, 49 of those loans valued at $221.8 million were disbursed.

This, according to the records provided by the Bureau represented the realization of 51 per cent of the Bureau’s target of 96 loans and 84% of the target disbursement value of $261.8 million.

Last year’s credit guarantee performance reflected a decrease in the performance for 2016 when 63 loans were approved and  62 disbursed, though the Bureau notes that the average size of loans last year increased to $4.52 million from $2.69 million in 2016.

Meanwhile, the SBB says that a total of 250 grants valued at $74.9 million were approved last year of which 185 grants valued at $56.4 million were disbursed. “The total number of grants approved and disbursed for 2017 increased significantly when compared to 2016. In the latter instance seventy three (73) grants were approved valued at G$21.9m while 71 grants valued at G$17.2m were disbursed,” the Bureau’s report said.

But according to the Report, the Bureau’s efforts to facilitate both credit guarantees with its two participating commercial banks as well as its attempts to provide meaningful support to grant applicants has not been without challenges. In the instance of the credit guarantees the report notes that medium and small scale enterprises, in general, “find it difficult to meet the requirements of these institutions, (the commercial banks) particularly as regards the form of assets required to cover the 60% loan exposure. It is against this background that the SBB has proposed to increase the guarantee coverage to a minimum of 70%.” The report says that the Bureau is awaiting “the relevant approval” in this regard and that a recently approved $100 million revolving fund, is also designed to address this gap.

In the instance of the Grant Scheme the report says that demand for grants has been primarily by microenterprises “at subsistence levels of operation” and that “this may be attributed to the fact that the maximum grant possible through this window is the equivalent of USD$1,500. It says that as a consequence the SBB has requested (and is awaiting approval) for “tiered grants ranging from USD$1,500 to a maximum of USD$5,000………. so as to attract more substantial and innovative start up enterprises.”

And the Bureau cites among its other achievements last year the development of a structured process for its impact and evaluation assessments. This, it said, allowed for on-site surveys in August last year to customers who received financial services from the Bureau during the last quarter of 2016, thereby allowing a six  to nine-month “potential impact period.” It says that businesses were randomly selected, visited and evaluated and that “thus far, the results show that about 65% of those evaluated have made `positive progress,’ with average increased revenue of 161% from our intervention up to August 2017.’ Those companies that are not succeeding are not `keeping books’ and in some in stances are not serious entrepreneurs.”

The SBB, meanwhile, has highlighted its In-School Youth Entrepreneurship Programme.

Through the programme, 100 students from 13 secondary schools across the 10 administrative regions of Guyana, benefited from entrepreneurial grants of $30,000 each. This pilot programme was officially launched in October, 2017 and will conclude April, 2018. The Bureau says that based on the monthly reports submitted up to this time “students are realizing the benefits of entrepreneurship in their lives and communities. They are also making requests to continue their businesses even after their phase would have ended.”

And the Bureau says that its Work Plan for 2018 was prepared “taking into consideration the focus of the Government of Guyana.” It says its plans “employ strategies that will contribute to a ‘green’ economy” and has, towards this end,  implemented and will continue to implement programmes and initiatives under a number of sub-programmes with training and education as high priorities.


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