Germaine Smith, Staff Reporter
Mallory Williams may have thrilled audiences with 'Boom She Boom' but his line of business did not move the bankers.
WITH THE iconic status that the public awards them and the fame they enjoy in the streets, it's hard to imagine a local deejay, singer, musician or producer joining the line at a commercial bank to apply for a loan with ordinary folk. With the perceived volumes of cash that run through their hands and bank accounts, it is a hard stretch for some to think that any entertainer will even need a loan at all.
Reality, however, is often very
different from perception, and the reality facing some in the entertainment field is that commercial banks are not exactly lining up to offer them loans, because of the uncertain nature of the music
business.
INCOME NOT 'PAPER TRACEABLE'
Banks have a hard time handing out loans to people whose income is not 'paper traceable', so to speak. Producers, deejays, musicians and other persons in the music industry often do not get pay cheques every month-end from the same source. Many of them do not have a fortnightly or weekly salary to look forward to, hence they do not meet the requirements of commercial banks to access a loan.
'What would an entertainer or musician need a loan for anyway,' one might ask.
Studio construction or renovation, upgrading, equipment buying and general business expansion are all expensive ventures which people in the entertainment field get involved with from time to time. The person may not be getting a performance or services rendered pay cheque at the time when the money is needed, hence a loan is required.
Musician Mallory Wiliams tells a tale which may be familiar to many others in his field. As a man involved for several years in music with various levels of success, Williams was stunned a few years ago when he went to negotiate a loan with a prominent commercial bank.
"I went there to look about a loan. I was in the waiting area and when I went to sit down, before it was my turn I think someone recognised me as an entertainer, so when I went to her she said that they don't lend money to entertainers," he recalls. "That was the end of that for me. I did not follow it up because if she told me that what more could I do?" he asked.
Mallory's incident dates back roughly five years and a recent canvas of commercial banks reveals that nothing much has changed in terms of their policy towards entertainers.
Official checks by The Sunday Gleaner at various banks were routed through different departments without much success, but casual anonymous checks with a few commercial banks revealed that the absence of a regular salary is the chief reason why many persons involved in the music business do not qualify for loans.
No, we need to see an accounting history and how the income is earned," stated a representative of one prominent commercial bank. "If not, the person needs to get an accountant to show a history of payments to show their qualification for the loan. They need to show means of income," the representative continued.
Checks with another commercial bank revealed that not even a consistent yearly flow of royalty cheques from foreign record companies will qualify as income for loan purposes.
Like others in the trade, Williams feel it is discrimination based on perception, but the banks hold on to the argument that they are only protecting their interests.
"It is very poor, because with a little help some musicians could do a lot more for the music," Williams notes. "They look down on the music over the years and think that musicians are idle guys and are just doing a hustle. I think that they do not have an understanding of how the music is made and how the music works, so they pass judgement. They don't see it as something profitable and something valuable for the country."
Jamaica Federation of Musicians (JFM) president Desmond Young sees it in the same way and takes quite a militant stance. He says that this has been a complaint by several of his organisation's members over the years.
"The banking system is strait-jacketed in their thinking," he argues. "They are trained a certain way and do not know how to think outside of this training. They just don't have any vision, because this is not a new industry. The music industry is all over the world," he noted. "If they followed these security principles and procedures about salary cheques so much, why then did the sector break down? What caused the mess?" Young asks.
"They have never taken the time to learn about the music business and see how they can align themselves with it. There are imaginative ways they could use and get into this multi-million business, but they only see it as a risky thing with no benefits to them."
Another option available to those in the business is the merchant banks. They operate differently from commercial banks in that they offer loans which are asset secured. Kerry-Ann Betton, marketing representative from Dehring Bunting and Golding, states that it is not an industry question whether or not they provide loans for customers, because it doesn't matter.
"To get a loan you would have to have an account with us firstly. If not, then titles for vehicles or land etc. that cover the cost of the loans will do," she explains. "It is not an industry question for us, to say we are discriminating against an industry. As long as we are secured to protect out loan it is different."
Another option is the small business loans which are offered by a few companies. A representative from Jamaica National Small Business Loans Ltd., who declined to be named when contacted, stated that people in the entertainment field will not get a definite no no to loan requests, but they may face some difficulty in securing the organisation's type of loan because of the nature of their business.
"As long as they fit into the loan processing scheme they would be eligible for a loan," he explained. "There are some industries that do not fit into the scheme and I suspect that this business is one of them ... Our loan payments are on a once per week basis, so you must be generating income to pay it back. That is the primary criteria we look for. Another one is that you must be in whatever business you are in for at least one year before qualifying for the loan. Once you satisfy this, we can sit down and work it out," he noted.
Young concludes that the difficulty in accessing loans in the profession is because of plain old stereotype. He cites First World countries which play huge roles in their domestic music industries, but states that we who adapt so many business principles of First World countries are yet to embrace our own product because of these stereotypes.
"The world loves us for our own thing, it is we who do not appreciate our own music and its products. We are ashamed of ourselves, so we do not see the potential that we have."
On the commercial bank side, things do not seem all too hopeful. On the other side, however, more risks for abound for those who may want to go that route. The choice is to sit and save the money, or risk the house and the land. One way or the other, each has its pros and cons.
