The Inter-American Development bank (IDB), is reportedly giving rural agricultural farmers and business operators in Jamaica a financing boost, by making US$630,000 (J$53.5 million) in loans and grants available to make access to financing easier for farmers and other rural entrepreneurs. The IDB is doing this through its Social Entrepreneurship programme.
The project, which is called the Spanish Trust Fund, is being administered by Microcredit Limited (MCL) and will run for three years. Gerard Johnson, the IDB’s representative to Jamaica, recently signed two agreements with MCL’s director Vikram Dhiman, making US$450,000 ($38.25 million) of the funds available for on-lending to the targeted entrepreneurs. Another US$180,000 ($15.3 million) was given to MCL to develop products, modify its practices and expand its services towards lending to rural and agricultural borrowers.
Johnson reportedly said the need of the rural enterprises was especially stark, given that only a small portion of the approximately 420,000 micro-enterprises in Jamaica are currently being served by financial services. According to him, “The project will provide much-needed access to financial services and business advice to rural and agricultural entrepreneurs, increasing their ability to manage their enterprises and become self-sufficient in the long term.” He said also that MCL was chosen as the administrators of the loans, because of its record of “building systems that allowed a sustainable basis of lending to micro-entrepreneurs“. Johnson also noted MCL’s willingness to extend its reach beyond the traditional locations and methods of lending.
For its part, MCL will increase its branch network from those in downtown Kingston, Spanish Town, Montego Bay and May Pen to four more in Manchester, St Elizabeth, Westmoreland and St Ann, where it will aim to serve 1,400 new micro and small enterprises with loans upward of US$400 ($34,000) per borrower to a maximum of J$100,000.
Dhiman said recently that the loans are being made available to agricultural borrowers who have a farm or other agricultural business and to owners of rural businesses in general. He said that the loans will become available in two to three months, once the infrastructure is in place. He added also that while the economic crisis makes lending risky, MCL has the capacity to minimise the risks of delinquency.
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