North Mariana suffers from a very serious local trade
problem when it is not tourist time. I spoke about it at the start of this
blog, but it is a severe issue that effects all residents. When the local
economy is low, everyone suffers. For a long time, it was just accepting among
the locals. Recently we had a local who wanted to fix this issue.
There is a lot of unused land in North Mariana, and as there
is so little work for everyone, he decided that because of the fertile land, we
could grow exotic fruits and vegetables that we could export. Now you need to
understand, this was never going to fix the local economy for good or be a
permanent solution. Nor was it meant to be.
But the farm provided a lot of the locals with a very key
opportunity. They were able to make money outside of the season. The
opportunity to still make a living outside of their seasons by being paid a
wage meant that this loan was something we were obliged to do for the
The farm was mainly a plantation more than an actual farm.
It became a plantation that grew bananas, but they also managed to grow tobacco
and a few other commodities which were considered valuable for the industry. It
was a great help to the locals for the short term, and in the long term it
became a sustainable business.
To this day, it is one of our proudest business loans that we have provided our customers. This kind of loan is always a great one for us and for the community.
The next type of loan we wish to source ourselves is one
that will help grow the local economy. Once the economy grows, the more money
the locals make and the more money we make. It’s a hard thing to say no to, and
everyone benefits from it.
One massive failure that I want to tell people about because
of how funny the story is based on a man who we once loaned money to. A
customer had asked for a loan for a Toy Story store. Now, there were so many
issues with this.
When the customer first applied for the loan, he was adamant
that he had the copyright and the acceptance for the use of likeness from
Disney. We were dubious about these claims, so we asked for proof that Disney
had “ok’d” everything. To his credit, he had the credentials and necessary
paperwork to the point we called the legal team of Disney ourselves to find
Turns out, he had the acceptance to use their likeness on
the internet for anything completely unrelated to selling products of their
likeness. Now, the person who had accepted this business loan has been fired at
this point for this mistake, as we were also liable to be sued for the mistake.
Surprisingly, this is not why the “Toy Store Store” failed. And yes, that was
the actual name of the store.
The store failed because of where he chose to put it. If you
have been to North Mariana, you would know there is a lot of “wilderness”.
There are a lot of areas that tourists do not want to visit, usually because
they want to stay within the centre of town or on the beach. Nobody really
wants to go to the middle of the island.
So of course, he decided that the best place to open the
store was in the island, where the tourists don’t go. Now, I don’t know if you
have been to a back pass in the woods, but shockingly you don’t see a lot of
kids who want Toy Story toys there. I’m sure you can guess what happened.
The biggest loan that we have ever given to a customer was
in the region of £500,000 to a customer who wanted to purchase and redevelop
many of the seaside residences near the beach to begin a hotel chain. The
reason we were so intrigued with this customer is because instead of creating a
hotel chain in the traditional sense, he wanted to purchase all the properties
to list on AirBnB.
AirBnB is a great website because you can book hotels or
villas and pay on a per day basis through your phone. If you decide you want to
stay an extra day or two somewhere and the residence is not already booked, you
can just book it directly on the app and it’s done. There is so little hassle
involved in using AirBnB and there are such strict quality control rules in
place that it ends up being better than looking at hotel comparison websites.
The website is also great for another reason. You can charge
a lot more. So, while most lenders would be scared to borrow such an amount, we
started to work WITH the customer to process and analyse just how much the
residential properties could make daily, a monthly basis and then annually. It
turns out, that £500,000 could be repaid within two summer seasons, and it was.
This is where being a smart lender comes into power. We
immediately saw the potential profits involved in the selections and decided to
upsell the loan amount which was originally £350,000 and increase the interest
rate, claiming it was due to the overall amount that we already raised
While you may think it is shady, we already knew he was
going to make a lot of money. We need to stay profitable. I am very happy to
say, to this day we still reap the benefits.
One of the biggest success stories of ours was when we
loaned a figure of £10,000 to a fisherman. Here in the North Mariana, we have
this amazing influx of shrimp and prawns that are waiting to be caught every
year. The problem is, due to the tourist nature of our location we do not have
a lot of genuine workers here. The small number of workers we do have do not
earn enough money to start their own businesses based off their catch.
That is when we were approached by this man, who let us know
that he planned to catch the shrimp and prawn to distribute to two sectors: the
tourist restaurants on the island, and the American harbour towns. American
harbour towns do not have a giant amount of shrimp or prawn distributors. This
may sound strange, but you must remember that any catches on the American seas
are distributed inland, not to the towns themselves.
This was a brilliant idea, but with all loans, there was one
hiccup that we felt would jeopardize this man’s business. The lack of proper storage
If you are catching even just 100 KG of shrimp and prawn,
you must consider the freshness of the fish by the time it hits inland. If you
do not maintain the stock, it can go bad very quickly. Especially as the fish
are so small.
That is why we increased his loan from £6,000 to £10,000, as
we would not allow him the loan unless the boat had the correct fridge or
freezing units. We want our people to be successful, and we knew that if we
were to loan him the original amount with his original plan, he would go broke
Any loan company has a duty to be considerate of their
customers and help them succeed, not just make a profit from them.
North Mariana Island Loans is based in (obviously) the Mariana Islands, and we service mainly resorts and small business around the area throughout the year. It’s hard to be a business owner in the Mariana Islands, as it’s very heavily influenced on the tourism trade. So, through the difficult times in the year when the residents need finances, we often help.
We offer very low interest rates on our loans because we know that it will be difficult if impossible for many of the small business owners in the area to repay loans throughout the wet months. That is why our repayment dates always start on the end of the first hot month. We know that the business owners are flush with cash, and the tourism industry starts to boom.
This does mean that companies and small businesses must pay a large part of their earnings back. Usually this means a sizable chunk from the first month. This is partially why we have to offer low interest rates. We cannot expect people to pay roughly 50% of their first month profits. However, we do not have a choice as we allow companies the winter period as a grace period. Not many companies provide that offer, and that is around the world.
Any area of country that relies in the tourism industry usually follows these problems. Once it gets too late in the season, the industry very quickly drops off for 3 to 6 months depending on where you are. We suffer from the same thing here, and reasonable loans are the only way for some to survive through to the next year.
Eventually we want to become a loan company for all areas around the world that are heavily tourist focused. We know that a lot of people have difficult times when they base their business or livelihoods from tourism, so we want to support people better around the world.