Governor of Central Bank Rick Hou has praised the government for its contribution towards the Small Loans Guarantee scheme with the provision of SBD$10 Million.He says the scheme has been talked about within Government circles for close to 20 years now and although attempts have been made in the past, the current arrangement is the most feasible.
Mr Hou says this includes the option for the participating banks to be part of the scheme and the provision of 10-million dollars to back the guarantee scheme.
He says additional features include a minimum amount of SBD$50-thousand dollars which is ten times more than the previous one and a maximum of one million dollars which is four times more than the old scheme.
He says the scheme will also guarantee 80 percent of the unsecured portion of the loan while the remaining 20 percent will be a trust between the participating banks and the applicant. Mr Hou says that under the new scheme, there will be no re-financing of the loan and no interest rate subsidy.
He says the decision whether or not a loan application will be financed solely lies on the participating banks, not the Central Bank or the government, which ensures that only feasible business plans get funded.