1. Access to Finance
Objective

To highlight the views of Caribbean bankers as they seek to provide finance to MSMEs, and to
present the strides made and the challenges which still remain.
Key messages to the participants

The banks need to know all that there is to know about the business. In order to present the
information that the banks require, the business must be organized, and the information must be
readily available. Therefore having good business systems is a duty and responsibility of the
business if they want the finance that is needed to grow.

A good business plan is a start, but banks cannot lend on a business plan alone. They must
evaluate the sector or industry, the owner’s ability to run the business, and the risks associated
with the venture. They will ask for contingencies, and will test the soundness of these.

MSMEs, by their very nature, have a higher risk profile than corporate, so the products designed
for MSMEs carry a higher interest rate to defray some of the associated risks. As the relationship
grows, MSMEs would become entitled to better rates, tenors and rewards.
Key take-aways from the participants' interaction

Participants left with a greater understanding of the situation from the bankers’ perspective: they
have a fiduciary responsibility to the depositors and must exercise care in lending.

While there seems to be a proliferation of training programs for MSMEs, there still remain
knowledge gaps in the way they view their businesses. Targeted training is mandatory, but not
with an academic slant. Rather, there is a need for more experiential learning, perhaps across
industries, rather than the generic sessions that are so popular now.

There still remains a huge gap in Access to finance for MSMEs. To assist in narrowing this gap,
some consideration could be given to assisting the governments establish a better enabling
environment: loan guarantees, tax concessions, faster registration processes etc.