By NEIL HARTNELL
Tribune Business Editor
The government's $20m small business support initiative has already been oversubscribed by some 60 percent, data provided to Tribune Business revealed last night.
Figures supplied by the Small Business Development Centre (SBDC) showed that micro and small business (MSME) applications to the Business Continuity Loan programme to-date are collectively seeking more than $32m in financial support to ride out the fall-out from the COVID-19 pandemic.
Some $1.2m has already been disbursed to these companies, with $5.5m worth of applications approved to-date by the SBDC and the initiative's lenders. The data shows 63 MSME applications have been approved, with 563 completed submissions received and another 1,120 in a state of partial completion. The applications cover companies that collectively employ 2,656 full-time, and 664 part-time, workers.
"It has surpassed the $20m expected," an SBDC spokesperson said of the demand for the Business Continuity Loan initiative. "The government will make announcements regarding an increase once a decision has been taken.
"We believe the impact will be significant, as it will allow businesses to maintain a favourable position with obligations during the economic shutdown and to brace themselves for economic recovery. Economic recovery recommendations will soon be finalised in consultation with the government and MSME stakeholders."
A breakdown of applicants by industry reveals that around one-quarter, or $8m, of the total financial assistance being sought relates to applications from MSMEs in the services sector. A further $6.334m, or 20 percent, has been requested by those in the retail sector, and $6.881m by firms classified as "other" industries.
Manufacturing applicants have sought a combined $3.23m, amounting to ten percent of the total, with those in finance, insurance and real estate and construction requesting a total $1.657m and $2.146m respectively. MSMEs in the wholesale industry, and transportation, communications, gas and sanitary services, have requested $1.68m and $1.282m, respectively.
The SBDC data suggests that the $50m estimated by small business consultant, Mark A Turnquest, as being necessary to meet the demand for help by MSMEs may not have been too far off the mark.
K Peter Turnquest, deputy prime minister, told the House of Assembly in late March that almost 75 percent of the $20m small business loan facility has been covered by the nearly-400 applications received at that date.
He said at the time that existing applicants had requested close to $15m in assistance from the Business Continuity Loan initiative, and disclosed that the government had expanded its MSME assistance by $5m to enable employers to meet staff payroll through grants ranging from $2,000 to $20,000. This will be offered to those who qualify for the Business Continuity Loan.
To qualify, MSMEs must be operating with a valid business license for one year or more; generate less than $3m in annual turnover; agree to retain 51 percent of their staff; and have their credit information shard with the newly formed credit bureau and other financial institutions.
The Bahamas Development Bank; the Bahamas Entrepreneurial Venture Fund; Cash N' Go; Leno Corporate Services; Omni Financial Group; Simplified Lending; and Fidelity Bank Bahamas are the partnering lenders in the programme.