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Wednesday, June 28, 1972
"This would require the service of highly qualified engineers
and other professional people which banks do not normally employ. If the
assessments were left to the banks themselves they would, as a matter of
normal commercial prudence, have no alternative but to refuse the loan
applications," Mr. Porter said.
It was estimated that the average cost to the Productivity Centre
of each feasibility study would be HK$3,000. However, both the Loans for
Small Industry Committee and the Trade and Industry Advisory Board realised
that an initial charge of HK$3,000 would be too high for the Scheme to
have any chance of success.
A compromise was therefore reached whereby the cost would be
recovered by an initial payment of HK$1,000 plus a charge of one per cent
per annum on the amount loaned, to be paid to the Productivity Centre.
Mr. Porter said both the Committee and the Board realised that an initial
payment of HK$1,000 would be unpopular, but felt that this was the best
payment system which could be devised, and probably the only one which would
be in any way acceptable to all those concerned with the Scheme.
To successful applicants the charge would represent only a small
increase in the cost of the loan, equivalent to 0.67 per cent to 0.08 per cent
per annum depending on the size of the loan and the period over which it
was granted. Unsuccessful applicants would receive a copy of the Productivity
Centre's report which would prove most valuable to them.
/Mr. Porter