Money Adviser with Hopeton Morrison

Dear Hopeton,

I am a part-time final-year management student at the University of the West Indies and I am also currently employed fulltime. I am interested in farming cash crops such as sweet potatoes and hot peppers and I have prepared a document on the expected revenues and expenditure and also the market.

However, I am without title to either land or a motor car and as such, find it extremely difficult to obtain a loan from any institution - and I have spoken with many.

I can repay the loan from my current employment and can provide a job letter but this is not enough. What can I do?

D.S.

Dear D.S.

You seem to have covered all of the critical bases. But agriculture can be a risky business, especially when acts of God such as hurricane, flooding or drought occur. That accounts for one of the reasons perhaps why you are finding it difficult to access financing for your farming enterprise.

But even here, farming cash crops is usually a good way to minimise your risks as generally, you are turning around a crop at least twice per year. And the market for hot peppers is strong, both locally and internationally-driven of course by the demand for jerk seasoning everywhere.

I cannot understand why you should be having such a big problem getting financing unless your plan is for some massive undertaking that is requiring millions of dollars of capital.

No one is going to undertake that type of financing unless you can provide collateral. At the same time, there are institutions that will lend you a reasonable amount of funds without title for land or car, if what you are planning is viable, of reasonable size and scope, and, as you stated, you are in secure employment.

Keep the business small to start with. To the best of my knowledge, you can access anywhere between $100,000 to $500,000, based on the above criteria. My advice to you is to go back to the drawing board and seek out some more lending institutions as you apparently have not exhausted the gamut.

Need advice on financial transactions, email: hmorrison@stccu.com.