The Government of Dominica has launched the Micro, Small and Medium Enterprises (MSMEs) Loan Facility at the Agricultural Industrial and Development (AID) Bank to provide access to capital for business investment and expansion.
Government signed the agreement with the Bank on Monday, March 7, 2022.
Government has loaned twenty-seven million, four hundred and thirty-one thousand dollars (EC$27.8m) from the Caribbean Development Bank (CDB) for on-lending to the MSMEs, through the AID Bank.
“The Dominica Labour Party Government has heard the cry of small business owners across the country for access to concessionary financing. Small businesses have taken a disproportionately hard hit due to the ongoing pandemic. We hear the call for assistance to bring their enterprises back to previous operational strength, to expand, and to prepare for the anticipated post-pandemic bounce back in the economy,” the Prime Minister said.
The loans are offered at an interest rate of three and a half per cent (3.5%) per annum on the reducing balance and borrowers will be given a grace period of six (6) months on the payment of the principal and interest. The maximum term is up to ten (10) years exclusive of the grace period.
The business must be registered with the Inland Revenue Division and the Dominica Social Security and the owner must be a citizen or a permanent resident of Dominica, operating on the island for 10 years or more.
To date, the Government of Dominica has made $38.8 million available for lending to MSMEs on concessionary terms. $5 million was placed at the AID Bank in 2020 and $6 million in 2021 as a COVID-19 response measure.
“This Government understands the importance of the contribution of the micro, small and medium enterprises to the Dominican economy – I speak here of the agro processors, the plumbers, electricians, farmers, fishermen, vendors, barbers, hairdressers, retailers, artists-and all the other entrepreneurs who ensure that economic activity remains steady. We believe the injection of funds into this sector will positively impact small business activity and touch the life of the common man in every village, in every part of Dominica.
“I encourage business owners who qualify, to take this opportunity to grow their businesses in a sustainable manner. The funds were secured specifically for you, to help spur growth in the small business sector. The next move is yours,” Prime Minister Skerrit stated.
The Prime Minister thanked the Caribbean Development Bank for its partnership with the Government and people of Dominica.
General Manager of the AID Bank, Marie-Therese Johnson, said the new facility will stimulate growth in the local economy.
“The line of credit is for on-lending to existing and potential clients within the productive sectors- agriculture, industry and tourism. The AID Bank is confident that this new line of credit will favorably impact employment creation and export substitution, sustain livelihoods and increase foreign exchange earnings.”
A micro, small or medium enterprise is a business-sole proprietorship, partnership or company- with annual turnover/sales less than two million and twenty-five thousand dollars, (EC$2,025,000).