JIS News

The government will shortly be disbursing the first set of cheques to financial institutions, to enable individuals and companies to begin applying for loans under the newly established $1billion revolving loan fund.
State Minister in the Ministry of Labour and Social Security, Senator Floyd Morris, made this disclosure at Friday’s (Sept. 29) sitting of the Upper House.
The revolving credit facility, which was announced by Prime Minister Portia Simpson Miller in her inaugural budget presentation in May, is being financed through the National Insurance Fund (NIF). The loans will be provided through an existing network of public and private sector financial institutions, referred to as Participating Financial Intermediaries (PFI).
Senator Morris implored financial institutions to exercise prudence in the administration of the fund, which will provide financial assistance to micro, small and medium size enterprises.
“We have ironed out the details and Cabinet has approved the procedure for this venture and we are good to go. We had a recent meeting with the stake-holders and outlined to them how this venture will be managed,” he said.
He pointed out that the loan facility was designed specially for established enterprises that have been making their National Insurance Scheme (NIS) contributions.
Senator Morris further pointed out that “it must be made poignantly clear, that the Ministry of Labour and Social Security will not be providing loans to individuals directly,” and that “this will be one through the relevant financial institutions that have the necessary expertise and experience in dealing with this sector. We are therefore expecting prudent management of this venture”.
Meanwhile, the beneficiary enterprises would be required to meet certain conditions, which will ensure that they function within the formal economy.
Outlining the terms of the loan, Senator Morris said “the financial institutions will receive a loan from the NIF at a rate of four per cent. They will then lend to micro and medium size enterprise at a rate not exceeding 10 per cent.”
He implored the financial institutions to “follow and honour the terms and conditions of the contract”, as the line of credit was “a loan and not a grant”.
Senator Morris further stated that “each financial institution must submit an annual report to the National Insurance Fund on all matters relating to the loans. Simultaneously, the NIF reserves the right to do intermittent inspection of the files of the financial institutions to ensure that they are complying with the terms and conditions of the programme”.