By Al Edwards, Financial EditorJAMAICA NATIONAL Small Business Loans Limited declares that women predominately seek loans to start their own ventures. The Jamaica National subsidiary is targeting small business persons unable to secure a loan from traditional banking sources.
The four-year-old company says its strategy is paying off and is reporting substantial growth in operations since its inception in 2000.
ASSIST MICRO ENTREPRENEURS
"We aim to assist micro entrepreneurs to increase their income and to ensure that a micro and small business sector thrives in Jamaica," general manager Frank Whylie said. He was speaking on last Monday at the JN Small Business Loans annual luncheon at the Pollyanna Restaurant at Stanton Terrace, in St. Andrew.
Mr. Whylie said the objective of the company was to support the development of micro-enterprises in Jamaica and to create new jobs.
In October 2000, JN Small Business made 2,019 loans valued at $38 million. As of August of this year, the number of loans increased to 7,918 (a growth of 292 per cent) for the year valued at $139 million.
Its staff complement has risen from 12 in 2000 to 81 today, with the number of field officers increasing from eight when the company started to the current 47. A JN Small Business Loans office can now be found in 28 locations throughout Jamaica.
Mr. Whylie said the bulk of JN Small Business Loans' portfolio is made up of enterprises in the distribution sector (76 per cent) with services accounting for nine per cent. With the manufacturing sector beginning to climb out of the doldrums it now represents seven per cent of the portfolio with agriculture accounting for five per cent. Transport takes up three per cent with the other sectors making up eight per cent.
OWN BUSINESSES
"We have found that women make up 73 per cent of our portfolio," said Mr. Whylie. "The women tend to be able to meet their payments and seem keen to start their own businesses."
As at August 31, 2004, the arrears to balance ratio stood at 3.53 per cent with the average loan size being $17,655 and the average loan term 22 weeks. For the same period the portfolio had created 7,917 jobs and had maintained and sustained a further 3,079.
Under Mr. Whylie's stewardship, the company has seen an increase in its loan disbursement to date. From October 2000 to August 2004, it has disbursed 42,541 loans valued at $1.3 billion. In fiscal year 2002/2003 it disbursed 9,690 loans valued at $280 million. This year has seen a significant increase with 15,765 loans disbursed at a value of $477 million.
STRATEGIC ALLIANCES
The idea off having a viable credit house aimed exclusively at the small to micro enterprises has always being viewed with a degree of reticence by many financial institutions. To spread its risks the company formed a number of strategic alliances. These included alliances with Jamaica Post for disbursement and collections, Pan Caribbean for credit funds and Jamaica National for funding, disbursements, collections and IT support.
The company also formed a co-operative agreement with USAID.
Looking to 2005, Mr. Whylie said that his company plans to offer new loan facilities in response to demand based on a survey it has conducted. It will explore the possibility of opening new offices in other areas of Jamaica not adequately served at this time.
