Innovative Mechanisms for Financing & Guarantees For MSMEs: Barbados

Transcripción

1 Innovative Mechanisms for Financing & Guarantees For MSMEs: Barbados Andrea Taylor Gerente de Programas, Asociación de Pequeños Negocios de Barbados Cooperación Económica y Técnica Reunión Regional sobre Mecanismos Novedosos de Financiamiento y Garantías para las MIPYMES en América Latina y el Caribe Santo Domingo, República Dominicana 19, 20 y 21 de abril de 2017 SP/RRMNFG-MIPYMES-ALC/Di N 4-17

2 Copyright SELA, abril de Todos los derechos reservados. Impreso en la Secretaría Permanente del SELA, Caracas, Venezuela. La autorización para reproducir total o parcialmente este documento debe solicitarse a la oficina de Prensa y Difusión de la Secretaría Permanente del SELA (sela@sela.org). Los Estados Miembros y sus instituciones gubernamentales pueden reproducir este documento sin autorización previa. Sólo se les solicita que mencionen la fuente e informen a esta Secretaría de tal reproducción.

3 INNOVATIVE MECHANISMS FOR FINANCING & GUARANTEES FOR MSMEs Presented by Andrea Taylor Programme Manager, Small Business Association Dominican Republic, April

4 OUTLINE OF PRESENTATION Overview of Market Special Finance Facilities The Credit Guarantee Fund

5 OVERVIEW OF MARKET Debt/Equity Financing Micro Finance (FundAccess, Enterprise Growth Fund, Youth Business Trust) Commercial Banks Credit Unions Venture Capital (Small Business Venture Capital Inc.) Equity Market Non-Bank Commercial Solutions Debt Finance (Axcel, Fast Cash) Leasing Trade Finance Angel Investing Crowd-funding Special Government Facilities Central Bank s Guarantee Schemes Factoring Programme

6 SPECIAL FINANCE FACILITIES Trade Finance (Factoring) Working Capital Import/export financing of exporting business Trade credits are typically short term and considered low risk Financing some or all receivables Financing contracts

7 Peer-to-peer & Crowd Funding Working and/or Growth Capital Lending for specific project Mobilise investment from individuals or firms Financial Return Based on Interest Paid Often Informal in Structure

8 Public Equity Markets Growth Capital Publicly listed company with shares traded by the public Individual and institutional investors operate in regulated environment Junior Market for SMEs

9 THE CREDIT GUARANTEE FUND The Credit Guarantee Fund is administered by the Central Bank of Barbados and has been established to assist small and medium enterprises in obtaining medium to long-term financing by providing security to eligible financial institutions for new loans (minimum loan requirement of BB$20,000.00)

10 Requirements for Eligibility Not more than BB $20 million in annual sales Not more than 200 employees Not more than BB $20 million in assets

11 ELIGIBLE SECTORS The Fund is open to incorporated small and medium enterprises registered to operate in Barbados. Sectors are: Agriculture Commerce Industry Service

12 Conditions of Fund Maturity periods on guarantees for credits shall not exceed ten (10) years. IFIs are responsible for setting the interest rate on loans guaranteed. MATURITY PERIOD INTEREST RATES Guarantees may be provided for loans USD $ or Barbados dollars (BBD). CURRENCY GUARANTEE PREMIUM A premium of 0.75% per annum will be charged on facilities guaranteed under the Fund.

13 Activities to be Guaranteed The purchase of land and buildings The purchase of equipment and machinery The expansion and improvement of infrastructure The implementation of new technology, techniques and processes An increase in permanent working capital, which is tied to an investment loan

14 Main Features of the Guarantee Guarantees can only be issued for new loans Guarantees can be provided on loans up to USD$1 million (BBD$2 million) per project Guarantees outstanding cannot exceed USD $3 million (BBD$6 million) for any one business Guarantees may be provided for up to 80% of the credit facility

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