Scheme targets startups

The National Business

By DALE LUMA
PRIME Minister James Marape has asked the Bank South Pacific (BSP) and the Department of Commerce and Industry to target new and existing businesses in the new soft-lending facility.
The Government paid K100 million to BSP to be kept in a trust account to serve as a security if small-medium business loan clients defaulted.
“We have been working since last June for this moment to arrive and I am sorry for the delay but it has finally arrived,” Marape said.
“K100 million will be held in trust as an added layer of security for Papua New Guineans to borrow at 5 per cent (interest) and (repayable in) 15 years.
“I have asked BSP and the commerce and industry department to target two groups:

  •  Startups, and BSP has facility for startups at the lowest rates; and,
  •  existing businesses which currently have a higher rate of repayment (which are) struggling, suffocating and needing interventions.
    “And so every Papua New Guinean in business has the opportunity to partner with BSP,” he said.
    BSP chief executive officer Robin Fleming said the bank was confident of the Government’s commitment to allocating funds for the programme, “notwithstanding the K100 million for this year, but more funds of up to K200 million in the next 12 months and beyond”.
    Micro Small Medium Enterprise Council president Des Yaninen thanked the Government for providing the funds to allow soft lending to take place.
    Yaninen said the average interest for a loan at the banks had been around 30 per cent.
    But with the security and partnership with the bank, it would mean a lower interest rate for MSMEs (micro small medium enterprises).