Financial Assistance to Micro

and Small Business Enterprise

Topics

1. National Development Foundation of Jamaica (NDF/J)
2. Micro Enterprise Financing Limited (MEFL)
3. Self Start Fund
4. Micro Development Investment Agency (MIDA)
5. Jamaica Exporters' Association (JEA)

The National Development Foundation of Jamaica (NDF/J)

The NDF/J was established in 1981 as a non-profit organization, to develop and promote entrepreneurship in Jamaica. This is done by means of credit, financing, training and a wide range of market-driven support services to micro and small business enterprises involved in manufacturing, services and agriculture. This provides an affordable alternative to debt financing by furnishing support to acquire vehicles, office equipment and machinery.  All loan programmes are further enhanced with a comprehensive training programme that is market driven and promotes the development of good, sound business practices.  The financial services offered by the NDF/J include, Regular loans, Opportunity Knocks-OK Loans and Lease financing.

Regular Loans

Between $20, 000 to $5 million is made available to small business operators many of whom would not normally be able to access loans from the regular financial institutions.  In order to secure financing, the borrower has to satisfy a number of requirements.  He/She must own a viable business and be directly responsible for the management of that business, meet the credit and collateral requirements and be willing to accept training and technical services.  Collateral items may vary from land/building to cash on fixed deposits, motor vehicles or a person or company who will pledge security for you.

The NDF/J will finance businesses in agriculture, manufacture and services.    

Opportunity Knocks-“OK” Loans

This is a group lending scheme which is based on the principles of the "Partner" plan.  The goal of this particular scheme is to assist in the development of the next generation of small business people.  To join, you have to be Jamaican and own and operate a business for at least six months.  You will also make up a group of two to seven persons who form security for the loan and consistently contribute every week for six weeks before the loan is granted.  Loans are approved and disbursed, starting at $6,000 per person in the first instance and must repaid in 16 weeks. Entrepreneurial groups in churches, markets, and community-based organizations etc. are ideal for this programme.   

Lease Financing

This is an alternative which allows a business person to enter into contract with NDF/J to operate equipment that had been purchased by the foundation.  Under this agreement the client will identify the equipment (which the foundation will purchase) and lease equipment for a fixed period repaying the foundation a negotiated sum on a monthly basis.  Some of the machinery that is available for lease under the agreement include:

·         New, reconditioned or pre-owned equipment

·          industrial grade machinery

·          office equipment

·         vehicles( excluding motor vehicles)

 The maximum value of assets financed in a single lease is the Jamaican dollar equivalent of US $13,000 (new) and US $ 10,000 (pre-owned).

Technical Services & Training (TST)

The services offered by the NDFJ includes training on record keeping, book keeping, supervisory management and time management and other areas critical to business operations.

Business Counseling

     Inventory Control

     Financial Record Keeping

     Record Keeping

     Preparing Marketing Plan

     Marketing

     General Business Management

     Factory layout

     Costing and Pricing

Business Assessment

     Does business assessments for clients

Computer Training

     Training in Microsoft

Seminars (in the areas of)

     Income Tax & Statutary Deductions

     Cash Flow management

     General Attitude at the work Place

     Marketing

     Quality Control

     Business Plan Preparation

     Pest and Disease Control

     Natural Foods and Herbal Medicines

     Export Policy

Business Plan

     Assisting Clients with a written Format of Plans for a

     business

Business Registration

     Assisting clients in conforming to Government regulation etc.

Entrepreneurship Programmes

     For grade 11 Students

     Business Advise

    Seminars for Farmers

     Focus Group Training

Certificate Courses 

     Computer Repairs

     Paralegal Studies

  Diploma Courses

    Paralegal Studies 

 Associate Degree Courses

      Business Studies

     Information Technology

 Special Courses

   Retirement Planning

    Budget Options for effective management

    Effective Selling

    Managing your Craft

    Partnering with the Community  

 Skills Training

   Basic Floral Arrangement

    Advanced Floral Arrangement 

Micro Enterprise Financing Limited (MEFL)

The Micro Enterprise Financing Limited (MEFL) is a not-for-profit corporation dedicated to the development of micro-enterprises in the inner cities and in urban communities in Jamaica. MEFL was incorporated on May 7, 2002 and is located at 12 Duke Street, Kingston. MEFL is a programme undertaken with the financial support of the Government of Canada through the Canadian International Development Agency (CIDA). The programme is jointly supported by the Bank of Nova Scotia of Jamaica and Kingston Restoration Company.    

Loans are offered for businesses in services such as hairdressing, information technology and dressmaking, in manufacturing in are as such as craft, metal works and food and drink processing and in agriculture in areas such as plants, fishery and farming. Loans are also offered for working capital and to purchase fixed assets.

Loans are offered on a group or individual basis. The group loan requires two (2) or up to five (5) persons. A group leader and treasurer should be chosen from among the group and all clients should attend business development training.

The loans are disbursed under a graduating system, with the first loan starting from $6,000 to $20,000 and can grow to a maximum of $200,000.  Clients can graduate to individual loans after receiving four to five group loans and have maintained an excellent payment record. These loans can start at $40,000. To qualify for any loan offered by the MEFL each individual has to own and operate a business for at least six (6) months, be willing to be a part of a group of 2 to 5 persons, live and work in the same areas as other members of the group, have a valid National I.D and meet some other requirements set out by MEFL. For further information please call MEFL at (876) 948-1224 or 922-6842.

Self Start Fund

The Self Start Fund was established in 1983 to provide loans for small and micro enterprises.  The fund's philosophy is that the small and micro enterprise sector has the potential to develop and create a significant employment if it is afforded adequate funding and appropriate management. The Programme therefore, is generally geared to meet the needs of those persons who have innovative ideas and initiative in terms of starting a business regardless of their level of education or background.  Entrepreneurship is promoted, as such, persons are challenged to start their own businesses and the fund tries to adopt a method of financing that is flexible, innovative and supportive to the growth of the sector.

Persons between the ages of 18 and 60 years are eligible for loans and those who are eligible, assets (excluding land and building) should not exceed $1 million.  The loan may be used to purchase basic tools, equipment and raw material for the use of skills acquired or to promote/extend a business venture.  The following are loans which are offered:

The small business Loan, which has a limit of $1,500,000 and a maximum term of thirty six months

The Micro Business Loan with a limit of $100, 000 for a maximum period of 24 months

The Micro Business and Short Term Loan which has a limit of $40, 000 for a maximum term of twelve months

Self Start Fund requires collateral to secure these loans and some of these may be:

     Third party guarantee

     Registered title

     Personal effects, equipment and furniture owned by the

     borrower

     Bill of sale on fixed assets purchased with loan funds

MICRO Investment Development Agency (MIDA)

The agency was established to assist in the development of the micro and small business sector through the provision of funding, technical assistance and training.  Financial assistance is given by means of wholesale credit to Approved lending Agencies (ALAs0 which are community based organizations owned and managed by community members known as Community Development Fund (CDFs).  The CDFs are located throughout the island.

To meet eligibility requirements applicants must be Jamaican, at least 18 years of age and should personally be involved in the business venture.  Loans may be made up to a maximum $100, 000 for individuals and $250, 000 for three or more shareholders.  Collateral to secure loans include:

    Bill of Sale on machinery, equipment or household assets

     Land Title

     Motor Vehicle which should be comprehensively insured

     Guarantors

Applicants assets should not exceed $600, 000 excluding land and buildings and all loans have to be approved by a credit committee.

Loans may be made for services, manufacturing and Agricultural projects in addition to any other feasible venture in:

    Livestock

     Crop establishment

     Cottage industries, eg. agro-processing, jams, jellies, juices,

     Art and Craft

Jamaica Exporters' Association (JEA)

Throughout the year the JEA offers seminars and workshops on various areas of interest.  These seminars concentrate on ways to increase production and export and are sponsored by the organisation.  Technical assistance is also provided to some companies in such areas as line design, quality assurance, sales management, packaging and labeling.

Financing

The JEA offers, to companies which qualify US dollar loans at competitive rates through financing programmes from World Bank, the Government of Jamaica, the Government of the Netherlands and other donors.     

Technology

The JEA has developed a website which will soon be expanded to feature more member companies homepages, guidelines and market surveys.  There is now an 'Information Systems' Advisor' to undertake 'technological audits' for member companies requesting assistance with computer systems upgrades and installations.

Productivity Tools

This Organisation provides productivity tools (software which generates export documentation, cash flow projections and inventory control applications).  All tools are provided with easy to understand manuals.

Publications

The information provided is mainly export oriented.  Information is provided on overseas markets and forecasts on the growth of certain sectors.  The JEA's Export Manual provides information on companies getting into exporting and helpful guidelines.  In collaboration with the Ministry of Agriculture, Plant Quarantine, Division, crop variety, transport destination and is produces monthly, quarterly and semi-annually.

Training

Seminars and workshops are sponsored and co-sponsored by the JEA throughout the year, concentrating on methods to increase production and export. Technical specialists can be used by a limited number of small or medium size businesses in areas such as sales management and line design. For 2005 The JEA will offers sessions which include “Maximizing Opportunities in the CSME”, “Marketing Strategies”, “Fundamentals of HACCP & ISO Standards” and “Effective Packaging & Labeling”.    

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