On Thurs­day, T&T’s largest com­mer­cial bank, Re­pub­lic Bank con­firmed that all new cred­it card cus­tomers would have a US$500 or the TT dol­lar equiv­a­lent. Re­pub­lic al­so con­firmed that while all pre­vi­ous cred­it card hold­ers would not have their lim­its ad­just­ed, they would not be is­su­ing any ad­di­tion­al cards to these cus­tomers.

The news, the lat­est in­di­ca­tion of the dearth of for­eign ex­change avail­abil­i­ty in the coun­try, was a fur­ther blow to small busi­ness­es who have turned to cred­it cards as a means to se­cure their prod­ucts.

Chief ex­ec­u­tive of­fi­cer (CEO) of the Arthur Lok Jack Glob­al School of Busi­ness Mar­i­ano Browne ac­knowl­edged that as a re­sult of the wide­spread for­eign ex­change short­age, these busi­ness­es would be hard hit.

“Well, un­for­tu­nate­ly, small busi­ness­es will have to do like every­body else and buy black mar­ket if they could get it. If’ there is re­al­ly one thing that af­fects every busi­ness it is cash flow. Get­ting for­eign ex­change in ad­vance or buy­ing for­eign ex­change in ad­vance is a chal­lenge and cash flow is af­fect­ed,” said Browne.

He not­ed that the sit­u­a­tion had wors­ened be­cause most peo­ple had seen cred­it cards as the stop-gap mea­sure in the midst of the for­eign ex­change con­straints, how­ev­er this did not ad­dress the wider prob­lem.

“The re­al­i­ty is that the for­eign ex­change sit­u­a­tion has not got any bet­ter, nor is it like­ly to get any bet­ter. Giv­en the cur­rent sit­u­a­tion, noth­ing has changed that will make it get bet­ter,” he said, “Every­one has turned to cred­it cards and that’s what the banks are say­ing. The banks are say­ing, What do we do? We know that the lim­its on cred­it cards have been com­pre­hen­sive­ly cut over time, They’re cut­ting the cred­it card lim­its. But why are they cut­ting the cred­it card lim­its? Be­cause the de­mand is com­ing up on the cred­it card side. Peo­ple have been us­ing the cred­it cards as a mech­a­nism to get around the for­eign ex­change short­age.”

He con­tin­ued, “Is it work­ing? Well, the an­swer is yes up to a point. But al­so, the banks are say­ing it is the same amount of mon­ey we have, and if every­body gets cred­it cards, if the de­mand for for­eign ex­change is go­ing up on the cred­it cards, the on­ly thing we can do is cut the cred­it card lim­its. Which is what they’re do­ing. That is the ob­vi­ous re­sponse. The banks are cut­ting the cred­it card lim­its be­cause they don’t have enough for­eign cur­ren­cy to meet their re­quire­ments.”

An­der­sen T&T’s man­ag­ing di­rec­tor and lead tax con­sul­tant, Kendell Rob­ley said SMEs (small and medi­um-sized busi­ness­es) have large­ly turned to this route be­cause they had lim­it­ed means to ac­cess cap­i­tal to grow their busi­ness.

He added that large­ly T&T’s SMEs do not know if there are any ad­di­tion­al op­tions to ac­cess cap­i­tal, as he point­ed out on­ly three SMEs had man­aged to emerge as pub­licly list­ed com­pa­ny on the Trinidad and To­ba­go Stock Ex­change: Cin­e­maOne, En­deav­our Hold­ings and Er­ic So­lis.

“How to sup­port SMEs in the T&T mar­ket is re­al­ly to pro­vide soft loan pro­grammes in place so they could com­pete in the en­vi­ron­ment, and al­so pro­vide ac­cess to cap­i­tal, be­cause that’s the most im­por­tant thing.

“Pro­vide cap­i­tal, ac­cess to cap­i­tal and pro­vide the tax in­cen­tive re­quired so they can com­pete with­in the Caribbean mar­ket and even the rest of the in­ter­na­tion­al mar­ket,” said Rob­ley who not­ed that there are sev­er­al pro­grammes geared to­wards sup­port­ing small busi­ness­es in this re­gard. Very of­ten, he said, en­tre­pre­neurs or start ups do not have the in­for­ma­tion, the know how or the re­quired sys­tems in place to ac­cess these fa­cil­i­ties.

“These are the ques­tions that we need to ask. At An­der­sen, we help them, sup­port them in terms of get­ting them fit to serve. What in­cu­ba­tor sys­tem we are us­ing to get them pre­pared to go in­to the cap­i­tal mar­ket? Be­cause the cap­i­tal mar­kets are high­ly reg­u­lat­ed. To get in­to those reg­u­lat­ed mar­kets, in­ter­nal­ly you must have the cor­rect process­es and pro­ce­dure sys­tems in place, and the peo­ple to dri­ve your busi­ness for­ward to be able to com­pete and get in­to a cap­i­tal mar­ket, get in­vest­ments and al­so com­pete in the in­ter­na­tion­al and Caribbean mar­kets,” he said.

Two weeks ago, Rob­ley wrote an ar­ti­cle de­tail­ing var­i­ous facts about the tar­iff sit­u­a­tion and its im­pli­ca­tions for SMEs in the Caribbean, “Mak­ing sense of US tar­iffs: What Trinidad and To­ba­go needs to know in 2025—and how to save.”

He ex­plained that he had writ­ten the ar­ti­cle to give cru­cial ad­vice to lo­cal busi­ness­es so that they could nav­i­gate this dif­fi­cult pe­ri­od. Ad­di­tion­al­ly, he is hop­ing to ad­vise them on oth­er piv­ots that could be pos­si­ble,

“We have put out the ar­ti­cle just to ad­vise them of the strate­gies to use to min­imise the pos­si­ble dis­ad­van­tages in that sort of en­vi­ron­ment. And we would have al­so have put out the five met­rics. We are look­ing at the VAT struc­ture; look­ing at the in­cen­tives; the in­cen­tive pro­grammes; look­ing at al­so analysing the in­ter­nal sys­tem op­er­a­tions, how to ac­tu­al­ly record the tax­es and so on. And with­in the op­er­at­ing sys­tem and claim­ing back those in­put tax­es with­in the Trinidad and To­ba­go econ­o­my. So those are the ar­eas in which I would have al­lowed them to nav­i­gate in these tur­bu­lent times,” he said.

Rob­ley not­ed that there is cur­rent­ly a 90-day pause on some of the tar­iff im­po­si­tions placed by US Pres­i­dent Don­ald Trump and this would serve as a cru­cial pe­ri­od for busi­ness­es. He how­ev­er felt the sit­u­a­tion should push T&T busi­ness­es to ex­plore op­por­tu­ni­ties with­in Cari­com and Latin Amer­i­ca.

“In T&T, the Latin Amer­i­can mar­ket is high­ly un­der­de­vel­oped. We may do some trade with Brazil, but Colom­bia and all those oth­er South Amer­i­can ter­ri­to­ries are op­por­tu­ni­ties to ex­plore with­in the T&T mar­ket for SMEs,” said Rob­ley.

The An­der­sen man­ag­ing di­rec­tor is ex­pect­ed to dis­cuss some of these strate­gies at the firm’s Lev­el Up Pro­gramme work­shop set to be held in Trinidad on May 18 and To­ba­go on May 25.

How­ev­er, he felt that fur­ther em­pha­sis should be placed on ed­u­cat­ing the SMEs as these busi­ness­es are a main dri­ver of the econ­o­my.