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Jan 13, 2014

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Guernsey killing entrepreneurial spirit

‘Starting a business is straightforward in Guernsey’… according to the official government website. Google the words business, entrepreneur, Guernsey and you may see sufficient evidence to support the government’s above claim. From the Google search you will see that the Island is flooded with start-up’s, mentoring schemes and funding prospects; you will be left feeling that Guernsey is a field of opportunity, where entrepreneurial spirit flows through the very roots and produces hundreds of mini Sir Richard Branson’s. In the words of Start-Up Guernsey’s Alexandra Kazantseva, ‘I fervently believe that inside everybody there is an entrepreneur or there is entrepreneurial spirit in everyone.’ And Guernsey is the place to be to release that inner entrepreneur right? Well that’s the message we receive... The island has also voiced its support in promoting IT and Software businesses so that they are not relying on financial services. There certainly is an aroma of opportunity, somewhat reminiscent of the 1849 American Gold Rush in the sense that the Island offers budding entrepreneurs the hope (and promise) of achieving their dreams. But is this opportunist aroma quickly turning into a lingering stink? Amidst this lingering stink is the fact that banks are starting to shut down business accounts as well as refusing to set-up new business accounts. With this in mind we decided to see how ‘straightforward’ it was to start a business in Guernsey. We put this to the test by ‘mystery shopping’ for two bank accounts for an online business and an administration business we were setting up. They were simply two small business propositions. In doing this we approached HSBC, Lloyds and Barclays…and guess what? All of the banks said no. Banks are blaming over regulation but essentially they are only interested if they are sure they will receive a good return. Are they using it as a way of channelling their profits in a tax-free jurisdiction? All we were asking for was a simple bank account so that a company could trade! Everybody has a right to start their own businessor so we are led to believe. The main politicians in Guernsey need to open their eyes and install a financial ombudsman scheme. They need to ensure that the banks stop treating residents as outcasts and put into action what they preach. Lee Perkins, managing director for Sage's small business division recently said this of entrepreneurism: "Business owners think of an entrepreneur as someone who has innovation in their DNA, but not necessarily the drive or basic business skills to succeed. "Ideas are vital, but for a business to discover its true potential the company must be grounded in reality and guided by an owner with a sound understanding of financial information." I believe it was the 19th president of the USA, Rutherford B Hayes, who said this of plutocracy: "Abolish plutocracy if you would abolish poverty. As millionaires increase, pauperism grows. The more millionaires, the more paupers." So many questions and not enough action or answers…one thing is sure though – Guernsey is slowly and surely killing entrepreneurial spirit. This isn’t just a matter that can be argued about and thrown around back and forth with no conclusion –lives and careers are at stake. We used to be proud of our banking system. The island does promise opportunity; an opportunity to make something of ourselves. But as it stands – these are broken promises: pride and opportunity has diminished along with our trust, hope and aspirations.  (Jan 13, 2014 | post #1)