Fueling The Recovery: Oil And Gas SMEs Find Support In Namibia’s Loan Scheme

By:Justicia Shipena
In Namibia, the Small and Medium-sized Enterprises (SMEs) Economic Recovery Loan Scheme has extended its support to an array of industries, including the crucial oil and gas sector.
Acknowledging the significance of this sector in the country’s economy, the Bank of Namibia (BoN) has confirmed that SMEs operating within the oil and gas industry are among the beneficiaries of this initiative.
According to the central bank, 200 SMEs have applied for the lending initiative.
The loan was given to 80 SMEs with a total value of N$85,9 million, while the remaining 120 applications are now being reviewed.
“The SMEs hail from wide-ranging sectors, including hospitality, retail, import and export, and oil and gas,”said BoN’s Kazembire Zemburuka, Director for Strategic Communications and International Relations.
The SME Economic Recovery Loan Scheme has emerged as a pivotal force in bolstering the growth and resilience of SMEs in the country. This crucial initiative has gained substantial traction, providing a lifeline to numerous such enterprises across the country.
“The SME Economic Recovery Loan Scheme is starting to play a significant role in supporting the growth and sustainability of small and medium-sized enterprises in Namibia, with over N$ 85,9 million disbursed to 80 SMEs across the country, allowing them to continue operating while providing further impetus to the revival of the economy,” Zemburuka said.
In response to the economic constraints resulting from the Covid-19 outbreak and its lingering repercussions, the scheme was relaunched in February of this year, and it is currently essential in providing inexpensive finance to enterprises in a variety of sectors.
It does it by providing much-needed capital, these SMEs are given a shot in the arm and have created employment opportunities for Namibians.
According to Zemburuka, the initiative has had a substantial response since its relaunch, with over 200 SMEs nationally submitting loan applications through regional bank offices of participating commercial banks.
“The Development Bank of Namibia is the latest institution to offer the Scheme for its existing clients,” he said.
The lending plan, according to the central bank, is intended to assist SMEs in promoting economic recovery.
The scheme entails the distribution of N$500 million to qualifying SMEs.
“As per the guidelines, SMEs can seek loans from N$ 50 000 to N$ 10 million. The loans are disbursed at a rate equivalent to the current prime lending rate, with a reduction of 50 basis points and less stringent conditions,” Zemburuka explained.
He stated that the loans aim to assist businesses in paying for operational expenses such as salaries, rent and lease agreements, and contracts with suppliers.
The excellent response to the SME Economic Recovery Loan Scheme, maintains Governor !Gawaxab, is encouraging.
He went on to say it demonstrates Namibia’s urgent need for such help for SMEs.
“We are convinced that the provision of loans will significantly contribute to the revival of businesses. We are steadfast in our dedication to ensuring the scheme’s accessibility to eligible small and medium-sized enterprises nationwide,” !Gawaxab concluded.