To provide an easier way for firms to obtain credit, a new fund for diamond companies is set to launch, Rapaport Reports.
“The diamond industry is in a major state of flux, with all the major commercial banks exiting the space,” Chris Del Gatto, creator of the Delgatto Diamond Fund, told Rapaport News. “There is an unprecedented shortage of working capital among dealers, wholesalers, and cutters.”
“The venture seeks to address that need for funds in a way that is both sustainable and affordable, explained Del Gatto, who is also the CEO of “I Do Now I Don’t,” a consumer-focused diamond-and-jewelry sales platform.
Getting funding will be much easier than the current process companies must go through to obtain a bank loan, according to Del Gatto. The lender will not necessarily review a company’s profit-and-loss statement the way a financial institution would, but instead will judge a potential borrower based on other factors, such as references.
In addition, borrowers will obtain loans using their diamonds as collateral. While the fund will hold the stones, clients will have full access to them at any time, with a few hours’ notice. Del Gatto’s service will also include the use of his online sales platform — the largest of its kind, he said — enabling clients to market those diamonds to consumers around the world. Using the platform will provide dealers with access not only to capital, but also to consumers, rather than just retail jewelers, which, he stated, will help them increase their profit margin.” says Rapaport.