As the Government of Jamaica pushes to create an enabling environment for Micro, Small and Medium-sized Enterprises (MSMEs), access to finance still stands as a hurdle on the entrepreneur’s journey. While acknowledging an increase in available financing solutions over the last decade, Jamaica Business Development Corporation’s (JBDC’s) Acting CEO Harold Davis emphasises that targeted, innovative financing solutions are needed to meet the unique needs of early-stage entrepreneurs.
Financing is needed to start a business and ramp it up to profitability. The financial year April 2024 to March 2025 saw entrepreneurs who accessed JBDC’s services amassing over J$200 million in financing—more than double the previous year’s J$99 million performance.
However, the JBDC has identified that early-stage entrepreneurs are being left behind given the lack of appropriate financing options tailored to their needs.
“Access to finance has two sides of the coin and that is the appropriateness of the financial product that is available and when I say appropriateness I speak of the product that is right for the particular industry. Or the particular stage of business of the entrepreneur,” the Acting CEO explains.
Early-stage businesses are those still validating ideas or launching operations. This means they may lack the financial records, collateral, or revenue history that lenders typically require. While mature businesses can access loans and other forms of capital based on proven cash flow, startups remain high-risk and underfunded, especially during the critical seed and pre-launch phases.
He continues, “A startup for instance, credit financing is perhaps not the best form of financing for a startup, seed financing for instance, but that’s what I mean by stage. Really credit financing is most appropriate when the entrepreneur is scaling in that phase of having done the validation and the product development and the Minimum Viable Product (MVP) analysis kind of work and then now at the point of scaling having had that proof of concept, that is when credit financing is most appropriate on that stage.”
Davis notes that venture capital, angel investment networks, and blended finance models could be powerful tools to fill this void.
While the JBDC does not finance businesses, the agency partners with public and private sector to bridge the gap between entrepreneurs and financiers. But more is needed.
Melissa Barrett, Manager of the Business Advisory Services Unit says clients need to be at a particular stage to access some existing programmes. “They need to be operating for at least a year and have some financial information demonstrating that they’re operating. So probably achieving revenue levels of at least two million…So that is a problem in itself. It’s not open to everyone.”
Still, the JBDC believes that new, tailored financial products must be developed specifically for startups and idea-stage businesses.
“It’s funding in early-stage programmes that I think the ecosystem could support. JBDC has the SBDC [Small Business Development Centre] Network embedded in it where there are universities and students coming out of these universities that want to start business,” Barrett says financiers could consider, “Whether or not funding can be given to them in smaller amounts to test and validate ideas that they have”.
JBDC plays a critical role in bridging the gap between entrepreneurs and financiers, “We work as JBDC on the entrepreneur side to make sure that they understand their business, that they are at a structured state, the MVP has been sorted out, and they are in revenue, with bookkeeping up to speed and all those kinds of things,” Davis shares.
“We also work with the financial institutions as well to work out what these appropriate products would look like,” he added.
To that end, the JBDC actively engages financiers across sectors.
“We have conversations with various financiers. We have conversations with the DBJ. Out of those conversations came the GEMINI product, for instance,” Davis notes. “We have conversations with Sagicor Bank, Access Financial Services, and others to make sure that they can understand the nuances and the vagaries, sometimes of the entrepreneur, to design appropriate products for them.”
The GEMINI Grant Programme is designed to support the growth and development of MSMEs. This is in keeping with the Development Bank of Jamaica’s (DBJ) mission to provide opportunities to all Jamaicans to improve their quality of life through development financing and capacity building.
GEMINI to support the handholding of 100 clients in the Nursery, Incubator, Accelerator and Scale-up Community Programmes at the JBDC.
These clients will be supported in areas such as strategy development, operational Improvement, marketing and finance based on gaps identified in their businesses. Some specific services include but not limited to business model development, pitch deck development, strategy and business planning. product development, branding, packaging, process improvement, market testing, audit and access, costing, pricing, budgeting, recordkeeping, reporting, analysis and valuation.
With the MSME sector fuelling economic growth through job creation, innovation, and exports, JBDC, as the agency driving entrepreneurial success, continues to champion solutions that make funding more accessible, inclusive, and aligned with the real needs of Jamaica’s entrepreneurs ‘From Concept to Market’.
-END-
