$6 billion disbursed to MSMEs

Observer writer

Wednesday, February 14, 2018

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The Development Bank of Jamaica (DBJ) disbursed more than $6 billion to the micro, small and medium-sized enterprise (MSME) sector in loans between April 2017 and January 2018, according to DBJ Managing Director Milverton Reynolds.

“As the nation's foremost development bank, our role in nation-building is reinforced by our focus on economic growth and development, and as such, it is imperative as a country that we grow and effect improvement in all we do,” Reynolds said in his address at the launch of the National Building Model Competition (NBMC) on Monday, held at the Knutsford Court Hotel in New Kingston.

Reynolds also used the forum to invite start-ups and small businesses “looking to expand” to employ the business model canvas for its adaptability.

He said $4.8 billion in loans was offered to small and medium-sized enterprises through approved financial institutions from April last year to January of this year.

For the same period, some $1.21 billion in loans was disbursed through DBJ-approved microfinance institutions to micro entrepreneurs.

Beyond debt financing, Reynolds pointed out that DBJ also supports the MSME sector by providing equity financing, capacity building and technical assistance.

“We have provided business support services and other forms of capacity development through our revolutionary Voucher [for Technical Assistance] programme to hundreds of entrepreneurs who are now able to access loans and other forms of funding because their businesses have been strengthened. And so, between April 2017 to the end of January 2018, 1,120 vouchers were issued for a value of some $236.25 million,” Reynolds noted.

He continued: “Additionally, through our IGNITE programme, we have supported 26 innovative start-ups who have been able to access over $60 million in grant funding, resulting in the creation of hundreds of new jobs.”

Among the beneficiaries of the IGNITE programme is Herboo, the winner of the 2014 NBMC and winner of the 2015 edition of the Jamaica Observer Mogul in the Making. By 2016 the company, which began as a manufacturer of organic shampoo, expanded its product line to include organic hair and body oil, and began exporting to the United States, Japan, and territories in the Caribbean.

On the matter of venture capital, Reynolds indicated that, “DBJ has committed some US$2.25 million to three private equity and private credit funds, along with over US$233 million from local and international investors for investment in Jamaican and regional businesses.”

The DBJ managing director credited the success of Jamaica's venture capital programme and, by extension, its reach in the MSME sector to partner institutions which share in the vision of the bank. Among them are: approved financial institutions, microfinance institutions, fund managers, and business services intermediaries. “We work in unison for the greater good of the Jamaican economy,” he said.

“Also of tremendous significance is the support from international development partners such as the Inter-American Development Bank and its Multilateral Investment Fund, and the World Bank,” Reynolds stated.

While thanking sponsors for their financial assistance with the competition, Reynolds also highlighted the need for know-how to be transmitted to the participants. He announced that for this year, the DBJ has set up a business mentor group to support student entrepreneurs.

In its fifth year, the NBMC is geared toward encouraging and supporting entrepreneurship at the tertiary level. Students from The University of the West Indies; University of Technology, Jamaica; Northern Caribbean University, and the Edna Manley College of the Visual and Performing Arts are provided with the opportunity to test and fine-tune their business concepts using the 'business model canvas'.

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