The Rural Enterprise Programme

Objectives

The aims of the Programme are:

1. to reduce unemployment which exist in the rural areas through the development of a sustainable micro business section.
2. to reduce the level of imports.

Funding

The Programme shall be funded through the Rural Enterprise Fund by:

1. such monies as may be voted by Parliament.
2. Such monies as may be borrowed by the Commission for its purposes.
3. Such other monies as may become available to the Commission from any other source approved by the Minister.

CRITERIA FOR LOANS

Priority will be given to applicants for small loans to start new businesses, expand existing businesses and those applicants who will be able to generate additional employment.

Other Criteria for Loans

Interest rate

Minimum of 4% per annum and chargeable on the reducing balance.

Default Interest

3% above lending rate and applicable where the applicant has defaulted in the repayment of an installment for ninety (90) days.

REPAYMENT PERIOD

Maximum of seven (7) years

SECURITY INSTRUMENTS

EQUITABLE MORTGAGE, BILL OF SALE, PROMISSORY NOTE AND DEPOSIT OF TITLE DEEDS.

CEILING

1. Ceiling of $50,000.00 for agricultural enterprises.
2. Ceiling of $25,000.00 for non-agricultural enterprises.

The Commission in its discretion, may approve loans in excess of the agreed ceilings, and also charge interest at the market lending rate.

PROCEDURES FOR APPROVAL OF LOANS

The applicant must complete the appropriate form which initially seeks to obtain relevant information on the applicant and the purpose for the loan.

Members of staff will visit the applicant and the proposed location of the venture to verify that the information on the application form is correct.

In cases where the loan is for up to $5,000.00 the applicant is interviewed by a Committee comprising members of staff.

A document, "Loan Proposal" which gives information on the loanee and the project is prepared and submitted with a recommendation to the Finance and Planning Committee, a Sub-Committee of the Commission, which may or may not accept the recommendation of the Staff Committee.

In cases where a lona is for an amount in excess of $5,000.00, the applicant is interviewed by Members of the Finance and Planning Committee. The "Loan Proposal" is prepared and submitted with a recommendation to the full Commission for approval. The Commission may or may not accept the recommendation of the Finance and Planning Committee.

DISBURSEMENT OF FUNDS

After a loan has been approved, and before any disbursement is made, the following procedures apply:-

The applicant is informed in writing by a letter which sets out the terms and condition of the loan;

The applicant is required to sign a Letter of Commitment;

The applicant is required to sign the appropriate Security Instrument;

In cases where the Commission decides to make the disbursement installments, the applicant is required to submit copies of the receipts as evidence that the amount advanced was used for the purpose for which it was granted.

The Rural Development Commission Porters, St. James Barbados Tel. Nos.(246) 422-4108             422-7666/67 Fax No. (246)422-76699