Message by Minister of Small Business, Entrepreneurship and Commerce, Dwight Sutherland, marking the first anniversary of the Barbados Trust Fund Limited (BTFL).
Fellow Barbadians and all, it is indeed with tremendous pride and industry that I present this message as Minister of Small, Business Entrepreneurship and Commerce (MSBEC) commemorating the first anniversary of the Barbados Trust Fund Limited (BTFL). Let me first thank the Honourable Mia Amor Mottley, Prime Minister of Barbados, who was the visionary of this revolutionary grass root SEED Capital Fund, even before she assumed office on 25th May 2018.
In addition, the hard working officers in my ministry with the support of the many other Government and private sector officials should be given full credit for ensuring that this initiative was given the full attention and effort needed to assist Barbadians in a gratifying and meaningful way.
In 2018, the BLP Government provided $10 million and has committed to the BTFL, SEED capital, for each of the next 5 years to all micro and small businesses or business owners, security-free loans of up to $5,000 each. When this loan sum is paid off in full, and the borrower has built a good credit profile the business/owner will become entitled to a loan of up to $10,000.
Trust Loans are available upon application approval, to all legitimate small business owners in every category of business, from nail technicians and hairdressers to well diggers, from painters to graphic artists, from tattoo artists to mechanics, from musicians to air conditioning technicians, from tradesmen and shopkeepers to caterers, creatives, florists and others. Barbadians understand the concept of a “meeting turn.” Let us think of Trust Loans as being similar in concept, but with Government putting in the first turn on your behalf.
The BTFL is a State Owned Enterprise reporting through the MSBEC. It is symbiotic of Government’s new, innovative and modern policy approach to facilitating economic growth and development, while transforming the Barbadian economy. It characterises the need for an innovative strategy centered around investment in the skills, ideas and endeavours of Barbadians.
I am firmly of the view that the envisionment and formation of BTFL rub shoulders with similar watershed policy initiatives such as which occurred (39) ago, on the 1st November 1980, The Tenantries Freehold Purchase Act came into operation by the then Government, which was the BLP administration.
The BTFL’s short-term objective is to create a framework that will maximise the income earning potential of individuals, with more medium to long-term view of generating positive economic activities, including the penetration of the Barbados Brand in regional and international markets.
To achieve this strategic objective, my Ministry has, over the last year, focussed on a number of initiatives aimed at stimulating the domestic economy by creating new and inter-generational wealth through the empowerment of micro and small businesses and the cultivation of an entrepreneurial spirit.
As such, the BTFL has been providing the requisite training, hand-holding, technical assistance and an appropriate financing solution to enable micro businesses to start-up and grow and for a cadre of vibrant MSMEs to emerge. The BTFL has been instrumental in tackling the social plight of our communities by reducing poverty; effectively utilizing and allocating scare resources within communities; skills up-grading, improving family life; fostering technical knowledge-transfer and unleashing hither-to untapped creativity, among other things.
Over the last year, the achievements of BTFL have been quite remarkable. The number of applicants allocated and disbursed with funds were (2,700) Two Thousand, Seven Hundred Clients. In monetary terms, approximately 12 million dollars ($12,265,384.00) have been paid out to persons to assist with their businesses and another 2 million dollars will be allocated and disbursed to those waiting in line by year-end.
Needless to say, the demand has been so overwhelming that even now the BTFL is processing requests from another 1350 persons, which when based on the average loan amounts of $4700.00, will require another $6,345,000.00 dollars.
The total number and value of loans approved by sex and sector were, for males 1318 which represented a total value disbursed of Bds$6,049,792.60 and for female 1351 which represented a total value disbursed of Bds$6,215,591.40. Included in those numbers were some 48 Retrenched (Male 18 + Female 30)workers who received approximately $207,000.00 to assist with their start-up businesses.
The BTFL has paid special attention to persons who were adversely impacted by the BERT program. In addition, the Fund has also sought to rehabilitate and assist 21 persons with disabilities but who have important and useful skills, to access loans to set up their businesses and to earn a decent livelihood. The BTFL will continue to do more of this…recognizing the major hurdles and challenges these people face when they go to the regular financial lending institutions.
Over the last year, the sectoral distribution of loans was as follows. In the Agricultural Sector, 324 loans were distributed at a value of $1,531, 249.38; Cultural Industries, 58 loans valued at $263, 307.08; Manufacturing, 211 loans valued at $952,069.11; Retail, 826 loans at $3, 635, 609.10; Services, 1,265 loans $5, 817, 549.74 and Tourism, 14 loans valued at $65, 599.60.
The majority of loans were disbursed to the Retail and Services Sectors. At least 35% of the overall businesses were able to employ an additional staff member to assist with their enterprises. So in essence, approximately 3645 new jobs were directly created by the loans and an undisclosed number of persons who indirectly may have found employment through those service providers dealing with the clients of the BTFL.
The positive response and massive demand from those clients of the Trust Fund encourages the management to seek better ways to help build their clients and they clearly recognize that there is no better way to help the sector than by continuous training and mentorship.
The Board and Management of the BTFL are investing in emerging technologies, innovation smart technology and knowledge of the various tools and techniques to enable the business person.
With 2700 clients, with another 1050 waiting to be disbursed and some 300 or so awaiting appointments for interviews, I am nevertheless pleased to report that the BTFL has positively impacted almost 4000 families/households.
It is however important that those persons who have been disbursed with loans, repay the loans in a timely fashion so that the long list of those in-waiting can be satisfied. The sustainability of such a program is very dependent on mutual trust between clients and the BTFL. The expectation is generally being realized. Over the year, the default rate for repayments is around 10%.
My Ministry fully appreciates the awesome responsibility of the BTFL and we are committed to “Stay the course” with these brave and enterprising Barbadians. In doing so thus far, the Fund has trained some 1315 applicants in business modules related to Financial Literacy, Customer Service and Marketing techniques.
The BTFL intends to get into the communities and use its experience to help the new and budding business folk. The BTFL will continue to conduct workshops within the communities in January 2020. We must find ways to accelerate a mental shift, so that the true business potential of our people is captured.
Recognizing that all cannot possibly come to us, the Barbados Trust Fund will be providing training at the community level, community by community with the overall objective of building an entrepreneurial culture and ecosystem. Courses will be offered in January 2020 in the communities namely; Financial literacy; Business financing; Budgeting / Cash Management; Goal setting – Setting SMART Financial Goals; Discovering my Financial Personality and Risk and Investing.
The MSBEC takes its mandate seriously and over the last year has established working committees seeking to engage the Ministry of Education on the methodology for integrating Financial Literacy and other business components into the Schools.
Discussions and interventions were had with a few Secondary schools, seeking to commence Financial Literary sessions, with some schools willing to undertake a customized program suitable and complimentary to their syllabus.
Training was provided to participants in FEED program @ BTFL at the beginning of August 2019. Training was also provided to personnel involved in the Transportation Augmentation Program (TAP). It was recognized that such persons could now be classified as new entrepreneurs. The BTFL carried out a training session as for The Academy for Women’s Entrepreneurship (AWE) of the United States Bureau of Education and Cultural Affairs as part of their outreach.
The Staff members of the BTFL are deeply involved in Entrepreneurship training as part of their internal institutional strengthening. This will fortify and assist in the business development needs for their clients. It is worthy to note that the BTFL staff complement is merely 9 persons.
Over the first year under review, the BTFL has been discussing and is finalizing with the FundAccess a “MOU”, Memorandum of Understanding and Ways and Means for these clients to get even greater amount of financing for their businesses. Management of the BTFL are discussing with the credit unions and some banks, mechanisms for making business easier for and affordable for many of the new entrepreneurs.
The BTFL has initiated some ‘Ease of Doing Business’ activities to assist the client, where the client can now pay back their loans and their vendors using online billing systems like SurePay. Further to that, and recently towards the end of October, some clients received their disbursement via credit card allocation / Mobile App instalment through Cave Shepherd and Co. Ltd. who has partnered with The BTFL to assist the development of the Small Business Sector.
For the first year, the Barbados Trust Fund Limited has started to showcase their clients on social media, promoting and advertising their products and services. If you go to those Instagram and Facebook pages you will hear, sincere and heart-warming accounts of how the Loan has helped some of the BTFL clients. Additionally, some of the training offered by the BTFL is being streamed on YouTube to assist our clients and those who may need such information.
Over the second year, the BTFL will embark on GOB’s trust development of communities. As such, BTFL will embrace community cluster development initiatives. I am convinced that greater social cohesion could result from encouraging cluster formation among the various entrepreneurial cohorts in Barbados.
Our Government, led by my Ministry, proposes to implement geographically-based clusters throughout Barbados using the Trust Loan mechanism as the catalyst. The aim of the initiative is to foster a national entrepreneurial spirit by encouraging collaboration, accountability, honesty and confidence among borrowers.
Fellow Barbadians, as we pen a new chapter in our country’s history, the evidence over the first year of BTFL’s shows that every effort was made by our Government through my Ministry’s BTFL to spread the wealth and to enable entrepreneurship, form partnerships, renew commitments and built a better society for all Barbadians.
Ministry of Small Business, Entrepreneurship and Commerce