VRDB small business loans to commence this month
By Jason Abel
Vanuatu Rural Development Bank (VRDB)’s marketing department has confirmed that small business loans will be launched on January 10, 2022.
It confirmed that the VRDB administrator has forwarded proposals, application forms and loan criteria to the Reserve Bank of Vanuatu (RBV) and once approved then the program is accessible for small businesses.
The money is for farmers and Small and Medium Enterprises (SMEs) who wish to take a loan for their businesses, with an interest rate of only 4%.
A few farmers from Tanna, Santo, Malekula and Pentecost had approached VRDB a few days after the government provided the VT600 million in December, which completed the loan of VT1.1 billion.
However, they were notified that RBV’s approval was required before VRDB can roll out the loan service. The loan is accessible to farmers and existing businesses.
Small businesses can loan within a range of VT50,000 to VT3 million.
The repayment plan for these loans is they are to be paid back on a monthly basis, at an interest rate of 4%.
Once launched, VRDB will be providing marketing offers to the rural farmers. The loan targets mainly farmers in Agriculture, from livestock, fisheries and forestry services, and will focus on industries (value adding services), including services (such as retail shop, tourism) as well as other small medium enterprises (SMEs).
In relation to land mortgage, VRDB confirmed it will deal only with registered lands (legally lands) as most of the farmers’ lands are customary land registered. However, it stated that the government will take their land as guarantee. VRDB will take property charge on products it provides to the farmers.
The Bank is appealing to all farmers in the rural areas that once the service is launched, they will be approaching their door steps aligning with the government’s decentralization policy. It affirmed that they will not be left out.
VRDB is hopeful that by mid-January, its officers will be rolling out the small business loan service.
It will be available to all range of small businesses in the country.