On the Corner with EPOC | Gregory Park residents want special interest rates for small businesses
The interest rates demanded by commercial entities have again been cited as one of the major factors preventing the growth of micro, small and medium enterprises (MSMEs) in Jamaica.
This time, the concern came from residents of Gregory Park, St Catherine, who participated in the latest Gleaner on the Corner with the Economic Programme Oversight Committee (EPOC) forum last Tuesday.
An impassioned Jason 'Buzz' McDonald charged that scores of Jamaicans are being prevented from acting on their business ideas or expanding their small businesses because of the interest rates. He said that this needs to be addressed.
"The interest rate for the poorer class should be more moderate than the higher class. If I want a money to borrow, money to do something urgent, I still have to be paying a high rate just like the big man who can afford it," said McDonald to shouts of agreement from other small-business operators who attended the forum at Crazy D Sports Bar in the community.
He was supported by Desmond 'Crazy D' Walker, who operates the cosy bar that hosted the forum.
"I am running my business, and if I should fall short, I try to borrow money to see if I can rise back my business ... because at the end of the day, I have staff to pay. I think that as a youth in the garrison who is not employed and who is an entrepreneur, my interest rate should be lower," declared Walker before McDonald continued.
"I think they can ask us to come in with the banking information to verify. A next man can't come to borrow and him have millions, and me and him paying the same interest rate," added McDonald.
He further argued for longer grace periods for small businesses before the loan repayment begins.
But Co-Chairman of EPOC Keith Duncan pointed out that many lending institutions already offer loan packages with interest rates and repayment terms specifically tailored for MSMEs.
"The point is well taken, but for those small business that need some capital and start-up financing to get their business going, there is what they call differential interest rates for small business who have an opportunity to grow and who have a business plan," noted Duncan.
While pointing to entities such as the Development Bank of Jamaica that create special plans for MSMEs, Duncan underscored the importance of the operators of these small businesses preparing business plans. He noted that there are agencies that offer help with getting the plans done.