Loan relief scheme for small businesses affected by Covid-19 |21 April 2021
Over R12m disbursed to 132 micro, small businesses as at end of March 2021
A total of R12,937,314 has been disbursed to 132 applicants under the Small Business Scheme Funds (SBSF) as at end of March 2021.
The SBSF was set up by government in collaboration with the Seychelles Chamber of Commerce & Industry (SCCI) in September last year to provide some financial relief to micro and small businesses affected by the Covid-19 pandemic whose annual turnover was less than R2million.
The loan relief scheme is being financed by the government of Seychelles and managed by Development Bank of Seychelles (DBS).
The scheme aims to provide financial support to eligible small businesses that need money urgently to alleviate their cash flow as they have been affected by the Covid-19 pandemic.
This refers to working capital of the small businesses and includes, but is not limited to, payment of rent, utilities, salaries, taxes, goods and services contracts, to the extent not covered under other measures announced by the government. Other expenditures considered and include, but is not limited to, cost attributable to digitalisation of business, cost to support with the adaptation to new public health guidelines.
The head of Credit at the DBS, Rana Fernandes, has said that since the fund was launched in September a total of 292 applications have been received as at March 31 from a range of sectors namely agriculture (3 applications), fisheries (6), industry/manufacturing/processing (33), services (140), other services (42), tourism (32) and transport (36).
There are 25 applicants who did not meet eligibility criteria set under the scheme, 59 are waiting to be processed, 60 have been declined because they did not meet the credit assessment eligibility criteria or they have been assisted under the CBS Covid-19 relief scheme while 11 applicants decided to withdraw their applications.
Meanwhile Ms Fernandes has explained that as per the procedure presently being observed under the scheme, once a decision has been taken and the loan is approved, a formal letter is issued to the applicant. As for declined applications, for now the clients may submit a request for an appeal against a decision taken. However it has to reflect a proposal on the way forward in relation to the reason stipulated on the aforementioned letter. It is however not guaranteed that the appeal request will be successful.
The main terms and conditions of the loan as applicable are as follows:
- 0% interest
- One off administration fee of R100
- Moratorium of 12 months and a maximum repayment period of 3 years, exclusive of the 12-month moratorium for the principal amount of the loan
- The borrower is responsible to repay 100% of the loan amount. When defaults occur, the DBS is obligated to follow its standard commercial recovery procedure
- A penalty interest will be applied to defaulters.
Marie-Anne Lepathy