Banks should invest more in small firms

THE Small Business Information Centre (SBIC) has called upon the banking sector to increase small-business loan portfolios, soften loan requirements, take calculated risks and make more investments in the sector.

SBIC Administrator and Small and Medium Enterprises (SME) Information Specialist Eneas Emvula made the call during the handing over of grants to the tune of N$142 340 by Nedbank to various SMEs on Wednesday. Loans are repayable within 12 months at a rate of 4,5 per cent.”Access to micro-loans required for growth and expansion of businesses has been identified as an urgent demand by entrepreneurs,” he said.According to the 2004/05 SME Impact Assessment, apart from the sector’s Gross Domestic Product (GDP) contribution of 20 per cent, the estimated percentage of the Namibian labour force working in small businesses has increased from 15 per cent in 2002 to 19 per cent in 2003 and 20,3 per cent in 2004.Emvula said the important message was that the business environment did frame and constrain the overall business performance – but to a large degree it was not a fixed influence.He advised that this could be altered by the right decisions and strategies in service provision.Micro-loans to six beneficiaries in 2005 resulted in the creation of seven new jobs, while 63 per cent of the loans have been repaid.This, according to Emvula, is an indication that the SME sector would benefit from a well-established micro-finance sector.Nedbank’s Executive: Marketing and Communications, Rector Mutelo, said this gesture forms part of the bank’s commitment to business and economic growth as well as to improve the lives of the poor and the less fortunate.”I cannot stress more the important role played by SMEs in the growth of all nations.As a matter of fact in many countries they remain the biggest employer and biggest contributor to the GDP,” he said.SMEs that benefited from the loan include ‘You and Me’, Kaitoo Leather Products, Mwamoi Fashion, Situlu Textiles, All Nation Rest and Simao Tailoring.Some of last year’s beneficiaries were granted loans again this year because of their good track record.The SBIC was established in 2002 as a public-private partnership venture by the Joint Consultative Council (JCC), City of Windhoek, Namibia Chamber of Commerce and Industry (NCCI) and the Ministry of Trade and Industry.It entered into an agreement with Nedbank last year for a loan pool fund.The fund is to assist potential SBIC-affiliated entrepreneurs by providing them with needed capital in the form of short-term micro-loans.NampaLoans are repayable within 12 months at a rate of 4,5 per cent.”Access to micro-loans required for growth and expansion of businesses has been identified as an urgent demand by entrepreneurs,” he said.According to the 2004/05 SME Impact Assessment, apart from the sector’s Gross Domestic Product (GDP) contribution of 20 per cent, the estimated percentage of the Namibian labour force working in small businesses has increased from 15 per cent in 2002 to 19 per cent in 2003 and 20,3 per cent in 2004.Emvula said the important message was that the business environment did frame and constrain the overall business performance – but to a large degree it was not a fixed influence.He advised that this could be altered by the right decisions and strategies in service provision.Micro-loans to six beneficiaries in 2005 resulted in the creation of seven new jobs, while 63 per cent of the loans have been repaid.This, according to Emvula, is an indication that the SME sector would benefit from a well-established micro-finance sector.Nedbank’s Executive: Marketing and Communications, Rector Mutelo, said this gesture forms part of the bank’s commitment to business and economic growth as well as to improve the lives of the poor and the less fortunate.”I cannot stress more the important role played by SMEs in the growth of all nations.As a matter of fact in many countries they remain the biggest employer and biggest contributor to the GDP,” he said.SMEs that benefited from the loan include ‘You and Me’, Kaitoo Leather Products, Mwamoi Fashion, Situlu Textiles, All Nation Rest and Simao Tailoring.Some of last year’s beneficiaries were granted loans again this year because of their good track record.The SBIC was established in 2002 as a public-private partnership venture by the Joint Consultative Council (JCC), City of Windhoek, Namibia Chamber of Commerce and Industry (NCCI) and the Ministry of Trade and Industry.It entered into an agreement with Nedbank last year for a loan pool fund.The fund is to assist potential SBIC-affiliated entrepreneurs by providing them with needed capital in the form of short-term micro-loans.Nampa