IDB Lab, the innovation lab of the IDB Group, approved a US$1 million loan to Term Finance SME TT Limited (SME TT), to support their innovative digital lending model which provides loans to excluded micro, small, and medium enterprises in Trinidad and Tobago, and later in other Caribbean countries.
Photo: IDB Lab
This financing, combined with resources from their local banking partners, First Citizens Bank, will enable SMEs to more easily and rapidly access the credit they need to expand their operations and sales, and thus sustain the crucial jobs they generate, mainly among vulnerable and low-income populations. The loan will focus on expanding and perfecting the online, customer-centric business model for MSME lending, piloted by SME TT since January 2020. Once consolidated in Trinidad and Tobago, it is expected that SME TT will subsequently begin lending operations in Guyana, Jamaica, Barbados, and Saint Lucia. In as little as 5 minutes, MSMEs can visit the company’s website (www.sme.tt), gather the relevant information surrounding interest rates, loan size, loan term, repayment terms, and submit their initial application, all without any need to physically visit the company offices. Loan applications to SME TT can be made 24 hours per day and 7 days per week. Having made the initial online application, MSMEs are contacted within one business day to complete the submission of the required documentation for the creditworthiness assessment. The digitization of the application process significantly reduces the required time and resource allocation, which is often a major hurdle in MSME access to finance.
Over the next few years, SME TT expects to extend loans of over US$45 million to more than 1,200 companies in the region, 50% of which are expected to be extended to enterprises that are founded or operated by women.
This article was originally published by IDB Lab.