Demerara Bank gets line of credit from IDB to fund small businesses
Demerara Bank Limited (DBL) has received an initial tranche from the Inter-American Development Bank (IDB) which will be used to provide financing to small and medium-sized companies supplying the local oil and gas industry. It will also be extended to other businesses in the forestry, mining and agriculture industries.
The sum is made available by IDB invest –a member of the IDB group committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector – under its Trade Finance Facilitation Program (TFFP).
It is provided as a line of credit or revolving fund format to be used for short-term international trade finance transactions to offer support to Small and Medium Enterprise (SME) businesses.
Chief Executive Officer of DBL, Pravinchandra Dave, explained that businesses with no collateral will also be assisted.
“The facility will be extended to the small scale entrepreneurs, small businesses for pre-shipment facility, for post-shipment finance. There are a lot of suppliers of services to the oil and gas companies which are not able to provide the collateral to the bank and what we can do [is] we can create a charge over the receivables and we can provide the facility to them (customers),” he told the media during a press conference at the bank’s Camp Street Office, Georgetown on Friday.
He added that the bank sees many opportunities to assist businesses in other areas including forestry, mining and agriculture.
Given the current context of high volatility in international markets and macroeconomic pressures from the COVID-19 health crisis, this line of credit is expected to support existing industries and new businesses in sustaining productivity and job creation.
The line will also allow increase foreign trade products to its SME clients, adjusting its menu of products to the current context of client demands.
To benefit more persons, Chairman and founder of DBL, Dr. Yesu Persaud said the bank will soon be opening a new branch at Mahaica, East Coast Demerara (ECD) which will ensure its services are available in other parts of the country.
IDB country representative Sophie Makonnen noted that the bank recognises the key role of the private sector in maintaining economic growth.
“We are cognizant that the private sector is pivotal for the economic development and a strong and healthy private sector, what we see as the engine of growth…it’s pivotal for the country to generate investment through creating employment opportunities contributing to increased level of income and improved standards of living,” she told those gathered.
IDB Invest with a portfolio of $13.1 billion in asset management and 385 clients in 25 countries, provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.