Backers of small business in the Dominican Republic have been lobbying for the National Congress to approve the “Ley de Garantías Mobiliarias”, a bill that would expand the variety of guarantees small business can use for applying for loans. At present, banks practically only accept personal assets, primarily real estate, obliging small businesses to use their homes as guarantees for any loan. In the case the business owner does not have property, commercial bank loans become even more difficult.
An editorial in Diario Libre on 17 July 2018 again brings forth the sad reality that it is easy to get a loan for buying a vehicle, but not one for increasing production in a small business. “Taking on debt for consumption is very easy, but for producing… a problem,” writes Ines Aizpun, managing editor of Diario Libre.
The bill is sitting in the Chamber of Deputies waiting for approval in this legislature that ends in August.
The editorial makes the point a law of this kind has been very supportive of small business in Central American countries and Mexico. “If unemployment and informality are the big problems of the Dominican economy, then approving a bill that strengthens these companies that concentrate 72% of workers not only is common sense, it is urgent,” writes Aizpun.
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Diario Libre
17 July 2018
