SME Bank Limited has so far approved N$40million worth of loans since its inception about two years ago, The Villager can reveal.
The Bank’s Head Marketing, Angrid Shimuafeni told The Villager that the type of SMEs that applied for the loans are start up businesses.
“Usually financing needs range from funds to execute purchase orders, financing tenders, asset based products, stock and term loan financing. Existing businesses also seek funding for expansion programs, buying existing businesses and diversification into other areas other than their usual business to increase their income or revenue. In terms of sectorial focus, we receive applications from the Service sector, Transport, Trading and least from Manufacturing, Agriculture and Education,” she said.
She also noted that they received a number of applications from the informal sectors and have a micro loan product which is designed for the informal sector to help them grow.
She added that they do not have specific products for women but all their products and services are attractive and accessible to women entrepreneurs particularly their micro loan product.
She said some of the challenges they still encounter as a bank are; “Most applicants do not have viable or bankable business plans, secondly those in business do not have financial records to demonstrate good track record and they lack contribution to the cost of the business.”
She added that, “In most cases they present business plans which they do not understand, thus making it difficult to convince banks about bankability of their proposals,” she said.
Other challenges faced by SMEs, the bank noted are lack of management skills to ensure successful management of businesses they want to establish.
SME Bank has a full commercial banking services and also offer loans to individuals and companies that are not necessarily SME’s, through Personal Banking (Retail), Corporate Banking , treasury and investment management.
SME Bank was founded by the Government of Namibia following the dissolution of the Small Business Credit Guarantee Trust (SBCGT) that was transformed into a fully fledged Commercial Banking Institution.
The bank provides special attention to projects of Small and medium sized Enterprises (SMEs) and those catering to rural communities, Micro Enterprises and previously disadvantaged individuals (PDIs).
The SME bank is also the first of its kind in Namibia since independence and has a public- private partnership shareholding.