How desperate are our people for financial support?
All you had to do was visit the Samoa Commercial Bank this week to find out.
Hundreds of people have been queuing at the bank since the Small Development Loan Scheme for the Low Income Earners (S.D.L.S.) was opened on Monday.
Speaking to the Samoa Observer, the S.C.B’s Managing Director, Lemalu Ray Ah Liki, said the number of people who have turned up during the last three days took them by surprise.
“I know that there have been long queues in the last three days, Monday, Tuesday, and today (yesterday),” said Lemalu.
“I think we already received up to 300 applicants and all of my staff are there to interview all the applicants and start processing their applications.”
As a result of the long queues, the bank will close their doors for applicants who want to apply under the scheme on Thursdays and Fridays.
This will enable the employees of S.C.B to process the applications.
“What I’ve noticed is that my staff don’t have enough time to process and evaluate all the applications. “So I have decided that we will spare Thursdays and Fridays to do the processing and we will only receive applications on Mondays, Tuesdays and Wednesdays.”
According to Lemalu, not everyone who comes in the door will qualify.
“Many of them are of slightly higher income bracket and I would like to assist these people,” he said.
“So we may have another window for (them), especially the genuine farmers who would like to expand or develop their land into short term crops and this will have a slightly higher rate (than the scheme) maybe 10 percent but they will also be taken care of.
“Because as I have mentioned, they are of a higher income bracket and have access to finance.
“But if I see a need there for these farmers or clients, (and that) they are inspired and they really want to develop and expand their farms and have productive investments, then I am prepared to give them a chance and lower the interest rate slightly than the normal one.
“So I am looking at assisting these people. This is something new but I am contemplating on assisting this part or portion of the population too.”
Lemalu admitted that the initiative was partly inspired after reading about the daily struggles of some of the families in Samoa featured in the Village Voice section of the Samoa Observer newspaper.
“Yes I saw in the paper that you’ve got this Village Voice and I noticed that there are people, who want to develop their lands and improve their prospects with higher income but they do not have access to low cost finance and also they don’t have good cash flow.
“And also they don’t have the security; nobody would want to guarantee their loan because they are risky. So I’ve decided with some of my shareholders to assist these people and so we’ve put aside some of our deposits to guarantee these loans.
“And that’s why we can’t entertain everyone. I know there are a lot of people who want to come under the scheme but they do not qualify.
“This (scheme) is specifically for families with low income and the people who are really struggling. “But I also look at the Village Voice that there are a few of them who want to develop their land, their farms and improve the livelihood of their families. So that’s one of the reasons why we decided to have this scheme.”
And like anything new in this life, there are always challenges and obstacles. For this scheme, the main challenge is faced by the staff of S.C.B.
“When I left for lunch this afternoon (yesterday), the queue was right up to the door and I felt for them (the staff) they probably haven’t had a break and I hope they had lunch this afternoon (yesterday).
“We didn’t expect the queue to be like this.
“We thought that people will come in gradually but I think everybody wanted to come and take advantage of the scheme.
“Despite the fact that some of them already know that they do not qualify under the scheme. But we will try and help them out under the window that we are now looking at for them.”
During the launch last week, Lemalu highlighted that this scheme is not exclusively for the rural and farming community. “A higher percentage of the facility will be directed to the cultivation and development of suitable short term crops, especially taro, given its profitability and demand by overseas markets.
“Other short term crops like vegetables, taro, peanuts, banana’s and fruits can also be financed under the loan scheme.”
He also explained that this is the bank’s way of helping those who struggle to get funds.
“This is for families who have problems getting loans from anywhere else because of the strict criteria,” he said.
“They have no source of income but they do have the ability to work on vegetable stalls or taro stalls and they would like to enlarge their activities.
“This is the assistance we could provide for them. Shareholders are securing these loans so they don’t need to look for anyone to guarantee the loans.
“We will give them the loans and we expect them to try and pay it back. That’s the whole idea. We want to help people who are unable to access funding for any reason.”
Loan Scheme Conditions
• Low interest rate for 6.5% per annum and loan amounts from $1,000 and $10,000.
• Repayment periods spreading over 12-36 months, on a weekly, fortnight and monthly basis, or when crops are harvested and sold.
• Loan funds should be used for the cultivation and development of short term crops, like vegetables, taro, bananas, peanuts and fruit crops.
• Loan funds should be used for the establishment and development of small business activities like elei, handicraft, food-stall, etc.
• Loan funds should be used for the purchase of essential household items and doing home repairs.
• Families with no or very low income.
• Families who have farming land and need capital to develop their farming activity.
• Families who need capital to start a small income earning activity.