by Curlan Campbell
- Cultural and Creative Industries Business Development Fund launched on Friday, 1 December
- Fund divided into 3 components
- Applicants must have registered business, tax ID number, security or collateral
A fund worth $2 million is now available for creatives wishing to start their business but finding it challenging to receive startup capital from commercial finance institutions.
Many creatives working in the cultural, entertainment, and digital economy struggle to get financing because they operate outside the formal economy. To address this challenge, the Grenada Office of Creative Affairs in the Ministry of Economic Development, Planning, Tourism, ICT and the Creative Economy has collaborated with the Grenada Development Bank to provide a concessionary loan as an incentive to encourage creatives to operate within the formal economy.
The Cultural and Creative Industries Business Development Fund forms part of Government’s ambitious plans to boost creative industries, which have been identified as priority sectors for economic growth. The fund was launched on Friday, 1 December 2023, and, Advisor in the Ministry of Planning and Economic Development with responsibility for ICT, Digital Economy, and the Creative Economy Orlando Romain indicated that loan applications can be submitted starting this week.
“We expect to be in a position to take applications as of Monday, and disbursements will begin in January 2024 because we do anticipate there will be a period of [people] getting their stuff together and so forth. We’ll start the application process, and official disbursements will start in 2024,” Romain said.
The $2 million Cultural and Creative Industries Business Development Fund is divided into 3 components tailored to the creative sector’s unique intricacies.
- The first component will make available a maximum of $50,000 loan at a 2% interest rate
- The 2nd component has made grant funding available for up to $25,000 explicitly tailored to not-for-profit organisations, such as dance and theatre companies
- The 3rd component will be a business support voucher worth $5,000 that will be disbursed to assist creatives in getting the necessary entrepreneurial skills to improve their operations in finance and marketing
General Manager of GDB Royston Cumberbatch reinforced the need for applicants first to have a registered business with a tax ID number. He outlined that, based on their proposal for funding, the bank may have to take some form of security or collateral.
“It is a soft loan. What is a soft loan? Whenever we say a soft loan, we mean no one is going to ask you to bring land before you get money. But when we say security, you have to understand that even in the current small business dollar fund that we have, unfortunately, it has a high level of delinquency. And that is for various reasons across the world. Most small businesses fail. There are reasons why they fail and we want to mitigate some of that, right by making sure the [people] are trained to understand cash flow management, they understand money management, but in terms of the security, there will be soft security. So, [the] Minister is completely correct, that in some cases, you might have what is called a charge on your floating assets. For example, if you are creative and you bought some cameras to set up a studio, it just means in your contract, it will say that if you are not paying your loan, then the bank has the right to take back your assets,” he explained.
Cumberbatch stated that the bank will undertake a rigorous vetting process once disbursement is made to ensure that the applicant uses the money for what it was intended. “We expect people to say why they want the money, and we will verify or vet that you are using the loan for the purposes intended. One way we do that is sometimes paying the monies to the supplier and not giving you the cash in your hand.”
Minister for the Creative Economy Lennox Andrews endorsing the initiative, indicated that this move is a further step to put people at the heart of a country’s economic development. “Now, philosophically, our view is that every individual is born with a talent. Every individual is born with an ability. Every child has a passion for doing something. The thinking is that if we can create the conditions for that child to utilise, enhance and develop that passion so that it can be used to produce a good or service for which there is a demand so that they can earn an income, then we know we are contributing to the development of the child, but we are also continuing to develop into our society.”
“There is the view that the more people that we have working on their own, the more the country is likely to develop. So, the development thrust must be such that the environment must be created for our people to utilise their inborn talent, their inborn ability, and their inborn passion and use it to produce a good or a service for which there is a demand so that they can earn a decent income and live a decent life,” Andrews said.
The establishment of affordable financing for creatives came out of extensive engagement stemming from the recently held UNLEASH: National Cultural and Creative Industries Conference in May 2023, where key personnel within the industry discuss strategies to enhance and promote sustainable economic growth for the Creative Industries. Stemming from that conference, Government moved quickly to establish scholarship opportunities for creatives to pursue courses in Introduction to Entertainment Law, Introduction to Entrepreneurship for Creative Industries, Marketing & Communications and Digital Media at the T A Marryshow Community College (TAMCC).
