Premier Alden McLaughlin urged micro- and small-business owners to take advantage of government’s grant and loan programmes, as the response to the relief measures, announced by Commerce Minister Joey Hew in April, still remains below expectations.
“I want to encourage micro- and small-business owners to pursue these opportunities which are available to assist you in navigating these challenging times,” McLaughlin said at the government press conference on Friday, 12 June.
The measures are administered by the commerce ministry’s Centre for Business Development and aim to curb some of the negative economic impacts of COVID-19. These include a $5 million low-interest loan facility, a $9 million grant programme, as well as technical assistance and training initiatives.
By 11 June, the Centre for Business Development had received 586 applications for government grants. The programme pays businesses three monthly payments of $1,000, which means that the allocated funding could provide non-repayable grants to up to 3,000 companies.
About 77% of applications have been processed and the total value of grant applications to be paid out has reached about $760,000, the premier said. He said 77 businesses have already been paid the full amount.
In contrast to the grant programme, the funding for the low-interest loan programme is provided by the Cayman Islands Development Bank. The premier said the bank has received 48 applications to date for approximately 34% of available funds.
Asked why the number of applications appeared so low, McLaughlin explained that government does not directly control the Development Bank, which operates as a fully-licensed bank with its own management and board of directors.
“We set up the system we provide the money, but they have their own protocols with respect to it,” McLaughlin said. “That has been the most problematic part of the whole exercise.”
The premier said one of the limiting factors was the Development Bank Law, which stipulates the bank can only grant loans to 100% Caymanian-owned businesses.
“So that eliminates a significant number of entities that would be operating here that might be Caymanian-owned but still have some degree of foreign ownership,” he said.
Government is having discussions about the issue, he said, because the low take-up “is the one truly underperforming bit of the package that government is trying to roll out”.