Many clients are cash constrained and are unable to afford the fees for an accountant to prepare the requisite statements.
A high level of informality among the businessesĬonsequently, the institutions have requested that the clients get their files organized so that proper assessments may be made of the businesses and the need for financing. The banks have cited the following issues that are prevalent among the customers: In the absence of proper records, the financial institutions are unable to complete their assessments. The institutions would review the documents, adjudicate the loan, and if approved, send an application to ECPCGC for a guarantee to make up for the collateral deficit. The process is that the entrepreneurs approach the financial institutions for loans, armed with their financial documents, projections, business history, and a clear idea of the purpose of the loan. In general, both banks and MSMEs are unfamiliar with guarantee schemes and the credit enhancement that they can provide. ECPCGC became operational in 2020 and its staff is working with banks in the six nations that comprise the ECCU. The programme provides guarantees of up to 80% on loans made by private sector lenders to qualifying micro, small and medium enterprises (MSMEs). The Eastern Caribbean Partial Credit Guarantee Corporation (ECPCGC) was created to increase the amount of financing available to MSMEs in the Eastern Caribbean Currency Union (ECCU).
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