Launch of New Loan Scheme
Last evening the St Canice’s Kilkenny Credit Union launched their Small Business Support Loan Scheme, which is a very timely intervention for small business in Kilkenny.
The Kilkenny CEB is delighted to partner with the Credit Union in combining our resources in the delivery of the Scheme. As you know, the CEB provides supports to assist the start-up, development and growth of small businesses.
We have found in recent months that the biggest challenge facing small business is cash-flow.
The vast majority of our clients, with the slow-down in the economy, have experienced falling turnover and margins, and this has been compounded by the added pressures of getting paid on time and accessing appropriate forms of credit.
Most of these businesses, while still profitable are struggling to survive due to lack of working capital - to pay the bills, to pay the wages, to pay suppliers, to take on new orders – in short to keep the business going. Cash is the lifeblood of all business and without cash-flow they cannot survive. The slow-down in the availability and movement of cash is now a critical issue for small business right across the country.
I would like to share with you just one or two headline statistics from a Credit Survey undertaken by the national network of CEBs recently. 56% of clients report difficulty accessing finance (in the form of overdrafts; term loans; bridging finance; etc.) with very serious implications for their business; and 76% report that debtor days have increased in the last 6 months. This is a double-edged sword.
I attended a workshop hosted by Minister Billy Kelleher on Monday afternoon last dealing with issues arising in relation to access to credit. This provided an opportunity to highlight the concerns and pressures being created as a result of the credit crisis in the small business sector, while at the same time hearing the views of the banks. The fact is that there would not be a need for schemes such as that launched by St Canice’s Credit Union if the banks were providing the service to small business. I know from chatting with the Minister after the event that he will be very interested in the operation of the Scheme in Kilkenny.
The small business sector is the future of this country. With the decline of Foreign Direct Investment in the years ahead, we are going to have to rely more and more upon our own capacity to create and grow indigenous small businesses to create jobs and to drive our economy. But we need to create the right environment and that requires all of us who interact with small business to be more creative in providing new forms of support to encourage and help small business.
Right now there is undoubtedly a gap in the market for the supply of credit. And the St Canice’s Kilkenny Credit Union have demonstrated tremendous initiative in responding to the challenge and putting in place this Scheme to help fill the gap here in Kilkenny.
The Scheme will help provide much-needed credit to a wide range of people:
• from those at start-up stage with viable new business ventures – giving them the finance they need to start their business;
• as well as existing businesses who remain commercially viable but are experiencing difficulty in accessing the necessary finance to meet their day-to-day working capital needs.
The Scheme combines a package of supports derived from the main strengths of the Credit Union and the CEB. The Credit Union will provide the loan finance under the Scheme, while the CEB will assist in 2 key areas:
• first we will help people make application to the Scheme. This will include providing advice and support to applicants in preparing the support documentation they will need, such as business plans and cash-flow projections;
• second we will provide an after-care service to all successful loan applicants, through the range of business supports we have to offer, including the appointment of a Mentor from our extensive panel of professionals to assist applicants to implement their plans and grow their business, as well as with cash-flow management.
So we hope that in working in partnership with the Credit Union and combining our resources that together we can provide through this Scheme a much stronger support package and give businesses the best opportunity for success.
This is very much a pilot Scheme. The process will evolve over time as we try to get it right for everybody concerned.
But our hope is that the Scheme will be a success, and that in time it will become a model for other Credit Unions throughout the county and indeed elsewhere throughout the country to partner with CEB network to roll out similar partnership initiatives, because they are very much needed at this time.
I have no doubt there will be great interest and demand generated in the Scheme. We look forward to working with the Credit Union and more importantly we look forward to hearing from small businesses out there. If you would like to hear more about the Scheme, give us a buzz on 056 7752662.
Sean.
Filed under: how we can help? | Leave a Comment
No Responses Yet to “Launch of New Loan Scheme”