Thursday 23rd June 2005


Micro credit: T&T seeking own lending approach

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Kyron Grant, right, and Angelita Charles talk about micro credit last week.

Photo: Noel Saldenha

The Government is looking to create 5,000 new businesses a year. Possible? Kyron Grant thinks so. Grant is the manager of the Enterprise Development Division of the Ministry of Labour and Micro Enterprise Development.

This year, is the United Nations Year of Micro Credit.

For T&T, that will mean a seminar, a school quiz, an awards ceremony and a grant programme which will take place later on this year.

Grant explained last week that micro credit is usually linked to poverty reduction but in T&T the focus has to be linked to wealth creation.

“Since a lot of the UN definitions talk about very abject levels of poverty and we may not have that in T&T, although I can’t say that categorically, they’ve brought in small enterprises and middle income,” he said.

While there are poor people in T&T, many would not be classified at the same level as those facing abject poverty in other parts of the world.

Any programme aimed only at poverty alleviation, then, would not have that much of an impact in T&T.

“If you go with that motivation it’s not going to be that relevant but you do have people at that lower level who are not happy with where they are,” he said.

The Division is using the year to reach out to the organisations that offer micro lending and to micro entrepreneurs themselves.

There are a number of private organisations which offer micro credit but Grant said the division is wary about imposing too many limitations on them.

“You do not want to stifle private organisations,” Grant said but added that there is need for more co-ordination among the different organisations. One reason, he said, is to make sure that people do not try to rip off one organisation and simply approach another.

The micro credit focus continues to be mainly on poor, disenfranchised women and youth.

Co-ordinator of the policy unit Angelita Charles said that the local model is about empowering women.

It is generally believed that a dollar lent to a woman goes further in terms of fighting poverty than that given to a man.

Young people, Grant added, also need special help, “particularly in T&T with our crime rate, the education system and issues in terms of employability.”

Micro enterprise, Grant said needs to be developed among young people as an alternative to crime and find employment.

He added that a poverty alleviation tag would also not be attractive to young people. That’s why “wealth creation” and “entrepreneurship” need to be used.

The division is also trying to create a registry of micro entrepreneurs. Grant admitted that it would be hard to find them. While there would be benefits to being registered—like tax incentives—many micro entrepreneurs do not want to be visible because that would mean paying taxes.

Grant added that in some cases the people employed by micro entrepreneurs have no protection as workers. There is no way to know, for example, the conditions under which they work.

Registration is also part of the Government’s Fair Share Programme which will allocate a portion of the State’s procurement to small businesses.

As a part of the year’s celebrations, the division will also be offering a grant to one applicant. The Government will match the loan amount offered by a micro lending organisation and while the grant will not have to be repaid, the original loan amount will have to be.

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