Thomas Pringle TD – Only 0.012% Uptake Of Microenterprises Loans
- Updated: 8th July 2020
Only 0.012% Uptake Of Microenterprises Loans
That is extremely low. I believe that small or microenterprises are the key to all of our constituencies throughout the country. There is a huge amount of employment among them. A huge number of people working in microenterprises struggle at the best of times and probably need this support.
We should be expecting 15% to 25% of businesses to be applying for and getting loans. The interest rates charged on the loans that have been granted and it sticks in one’s craw to see interest rates of 5.5% or 6.5% being charged when normal interest rates are around 0.5% or 1%. That is a barrier. I would like to see information about how big a barrier it is because I imagine if I was in business and was going down the tubes, if I could get money at 5.5% I might take it to keep myself going.
The loans also need to be looked at further because of the amount of information required, the work that has to be done and the cost involved in getting the loan and providing all the paperwork that is needed. That must be looked at and addressed. I would like to see a report on what the barriers are for businesses in attracting loans.
I support the Microenterprise Loan Fund (Amendment) Bill 2020 but it needs to be looked at and evaluated over time with regard to what the actual barriers are. The interest rate is probably one of the barriers and perhaps the publicity it has received has prevented people from looking to access the funding but there are an awful lot more barriers in place. Many small businesses do not have the level of paperwork required to consider the loan. The number of businesses applying to the fund needs to be increased significantly.
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