Gowon Bou, CEO of Fidelity Bank, believes that retail banks’ unwillingness to use liquidity to take business development risks is the cause of slowing the growth of small businesses in the Bahamas. What it lacks is access to financing opportunities and poor business planning. Guardian business yesterday.
Bow said that while local retail banks are often criticized for not providing enough funding to small businesses, the same can be said for retail banks in developed countries.
He explained that what the developed world does not have in the Bahamas is the existence of myriad funding mechanisms outside of the retail banking sector.
“The biggest obstacle to corporate financing is not having what I call the full spectrum of financial institutions that you see in developed countries,” said Bowe.
“That means there are no venture capital institutions or private equity fundraising groups that ultimately offer wealth and deep funding opportunities. It is not the place to find funding for risky businesses. That traditional banks, in building society, are the real pools of depositor and shareholder resources that can be invested in established businesses looking to expand. We had an eye, but actually already had a cash flow history or pattern that we could actually trust about how they were able to raise money.
“I’m excited now in terms of how we move forward and expand access to start-ups – and I mean businesses with limited track record – how do we capitalize on We need to consider whether to expand the market The Bahamas allows resources to be pooled by those willing to invest in riskier ventures.”
Bowe talked about developing tools such as crowdfunding platforms like ArawakX.
Opportunities exist for SMEs to access financing through retail banks, but in most cases they must be assisted by government-guaranteed loan programs offered by the government-run Access Accelerator/Small Business Development Centre.
Bowe argued that retail banks are almost always not the solution for funding startups in the Bahamas.
The Inter-American Development Bank (IDB) released a report on Monday that found access to credit could lead to economic growth and more jobs in the Caribbean. However, the report found that entrepreneurs are frustrated by the bureaucracy involved in securing financing and the cost of financing.
Bau said local entrepreneurs have to start getting creative when trying to raise capital. He added that more equity funding groups need to be developed to meet the needs of these entrepreneurs.
“The question is not how to qualify companies for funding from financial institutions, because we think retail banks are the solution,” he said. I was.
“We need to say how we can enable individual retail savers and investors to collectively pool resources to provide alternative financing not traditionally done in the Bahamas. , that’s really where the dials need to be turned: having the technology and platform to enable crowdfunding and business vetting …these are the biggest investments and resource deployments for these types of activities. It’s something we need to promote and inspire by showing how to get in. Expanding the access pool of those looking to invest.”
Bow said entrepreneurs also need to look at the quality of the business plans they put together.
“Just because you have a great dream doesn’t mean it’s worthy of funding.”
https://thenassauguardian.com/retail-banks-are-not-the-problem-in-small-business-start-up-game-says-bowe/ Retail banking is not an issue in the small business startup game, Bow says