The Small Business Development Finance Trust Incorporated provided some 685 small loans in 2010 to the tune of Gy$274.1 million. This is according to its chairman Sattaur Gafoor, at the trust’s eighth Annual General Meeting at the Tower Hotel, Georgetown on June 27.
Prime Minister Samuel Hinds does a little dance after presenting a plaque to Lyla Kissoon (second from left) for her outstanding contribution to nation building at the Small Business Development Finance Trust Inc AGM. Also in photo is managing director of the trust, Manjula Brijmohan
Gafoor revealed in his report that, despite several hurdles, the trust has managed to increase its lending by 22 per cent from the 652 loans disbursed in 2009. He said that loans were distributed in four categories: developmental, consumer, housing and micro loans. Under developmental loans, Gy$217 million was invested in activities that resulted in increased production in various sectors. These loans were provided to the sectors that showed high growth potential, such as agriculture, fisheries, and manufacturing.
Some 405 micro-loans were disbursed to the value of Gy$28.3 million to small businesses; while Gy$13.8 million was paid out in consumer loans. The latter was used mostly for home improvement. The Trust also helped 46 poor families to build their homes with small loans, once they had acquired house lots from the Housing Ministry but did not qualify for bank loans.
According to Gafoor, the total revenue for the year was some Gy$48.7 million, as against Gy$38.9 million in 2009, generating a surplus of Gy$17.6 million for the year despite heavy interest costs. “All (this) shows that SBDF has grown into a strong institution with a capacity to honour its financial, as well as its developmental obligations,” the chairman stated.
More efficiency
In the year under review, the company and the International Finance Corporation (IFC) co-financed a US$265 million project to streamline credit policies and loan administration. The initiative was also aimed at implementing automated accounting and loan monitoring systems.
“Today we have a fully operational management information system, which has improved financial credit control and provided more efficiency in the management of the loan portfolio,” Gafoor noted.
The renowned businessman has committed on the financial institution’s behalf to work harder to assist in the creation of self-employment and to improve the trust’s efforts to help transform dependency into confidence and greater income realisation.
“SBDF will continue to focus on enhancing the skills of our clients through training, counselling and the provision of timely credit assistance,” Gafoor expressed.
He spoke of the challenges that small businesses were made to endure with the global financial crisis, and acknowledged that for small and medium-sized enterprises (SMEs) to thrive, their needs should be covered under macro-economic policies. As such, he commended government’s passage of the Micro Finance Bill last year.
Do more for SMEs
Meanwhile, the development finance’s managing director Manjula Brijmohan, in her report, acknowledged the significant role SMEs play in advancing economic prosperity. She pointed to the role these have played on the high growth rate in countries such as China, India, Japan, and even the United States.
However, she lamented their limited access to capital, which these small businesses need to grow. She insists that real support to create competitive strength remains limited. “The government investment in infrastructure, such as roads, bridges, power generation, water, and reliable telecommunication, has started changing the landscape of the country, but fast growth in movers, producers, consumers and commerce needs serious stimulus to energise the growth in this sector,” Brijmohan added.
According to her, the local private sector is insensitive to the development of SMEs, though many derive benefits from SMEs. “We need the private sector to see that small is beautiful and not negligible.” Further, she lamented the absence of provisions for SMEs in the Small Business Act that was passed in 2004. The development finance managing director insists that more needs to be done for the “small dynamos”.
“As the country moves forward, we need to strengthen SMEs, not only in terms of numbers, but more in terms of providing support needed in production, technology, processing, storage, packaging and marketing,” Brijmohan encouraged.
She was adamant that the government must provide strong stimulus to attract investment in these areas.
The SBDF is committing to bring prosperity to its partners, regardless of their small capital limitation.
The financial institution, which was created in 2003, has disbursed some 5,308 loans, valued at more than Gy$1billion. These are said to have created some 10,699 jobs during the last eight years.
In the meantime, SBDF also honoured eight of its clients. Krishnan Jugdeo received an award for the best young entrepreneur. He cultivates rice, rears tilapia and was still able to pursue studies in accountancy. The award of most progressive entrepreneur was given to Suknanan Rajaram, who owns four businesses – a supermarket and clothing store at Parika, and two recent ventures in Bartica.
Other awardees include Cheryl Brandt-Best, the innovative female entrepreneur; Courtney Stanton- Best, the innovative male entrepreneur; Sumintra Singh, the best female entrepreneur; and Certial Mc Allister, the entrepreneur with best growth potential.
Lyla Kissoon also received an award for her outstanding contribution to nation building.
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