$7m loan guarantee from ADF and EU is for small and medium enterprises โ€“ Prof. Prasad

$7m loan guarantee from ADF and EU is for small and medium enterprises โ€“ Prof. Prasad

By Rashika Kumar , Marika Rasekaseka
Wednesday 24/05/2023
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad

Following the signing of an agreement between French Development Agency and the European Union to provide a $7 million loan guarantee to the Fiji Development Bank through the issuance of the EURIZ guarantee, Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says it is clear that this is for small and medium enterprises.

This comes after concerns were raised by some women who applied for a loan last year and did not get it or even a response from FDB.

People have also raised concerns as millions have been given to entities such as those that built Pullman Resort which was sold to recover more than $80 million and Grace Road which later refinanced its $5 million loan with BSP.

FDB CEO Saud Minam says there are certain conditions that have been agreed upon by the bank and the ADF which are the guiding rules.

He says they need to provide ADF the data in terms of who are their customers because they are the ones who are guaranteeing the loans so they cannot be giving loans to just anyone as FDB also have their own internal credit risk criteria and they will provide the lending based on that.

Minam says they have their own Act, mandate, Board and supervisory body that is the Reserve Bank of Fiji.

The CEO further says they do not discriminate against any customer and adds that in the last 12 months, close to 1,000 customers have already taken a loan from the bank.

Minam further says this guarantee allows them to go into markets such as micro, small and medium enterprises and small and micro enterprises as well as upper size of SME as well.

He says according to the Reserve Bank of Fiji definition, micro is a business with a turnover of below $50,000, small is $50,000 to $300,000 and $300,000 to $1.25 million is medium enterprises.

Minam says it does not restrict them from going to any business so this facility is open for everyone.

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