SME financing targeted to the construction sector
While commercial banks finance local small and medium enterprises (SME’s), they are more focused on targeting the construction sector, as the property can be easily repossessed if the client defaults.
These sentiments were shared by Hafeni Hamukoto, a senior associate at BFS Fund Managers, at a presentation on SME financing in Namibia hosted by the Institute of Public Policy Research (IPPR).
In a detailed report authored by Martha Nangolo, a Research Associate at IPPR and Hamukoto, challenges faced by SME’s are highlighted.
Namibia’s SMEs are unable to secure enough finance, as a result, their capacity for growth and innovation has been hampered over the years, which has, in turn, prevented the country’s economy from realising their full potential.
Secondly, the Namibian domestic capital markets are very small and offer little or no financing platform for SMEs. The capital markets also offer little liquidity and this has been a point of serious concern amongst SME owners.
NSX
The report recommended that the Namibian Stock Exchange (NSX) create special tier-based SME segments to enable easier listing of SMEs, with support from private financial institutions.
In addition, SME visibility to the broader investment base can be described as the third most challenging obstacle SMEs face. Visibility is crucial for investors, as most investors do not attend seminars or start-up events.
More public and private funding is needed for training and support programmes to handle the high demand. In addition, experienced and qualified trainers should be used while industry experts should be brought in to cover specific sectors.
Lastly, governmental support, specifically targeted at SME development, is critical for their success. Costly business registration costs, longer business and trademark registration times, taxation regulations that are not supportive of SME development, and nepotism and corruption affecting SME funding and tender opportunities have all hindered SME development in Namibia. The detailed research paper is available on IPPR’s [email protected]
These sentiments were shared by Hafeni Hamukoto, a senior associate at BFS Fund Managers, at a presentation on SME financing in Namibia hosted by the Institute of Public Policy Research (IPPR).
In a detailed report authored by Martha Nangolo, a Research Associate at IPPR and Hamukoto, challenges faced by SME’s are highlighted.
Namibia’s SMEs are unable to secure enough finance, as a result, their capacity for growth and innovation has been hampered over the years, which has, in turn, prevented the country’s economy from realising their full potential.
Secondly, the Namibian domestic capital markets are very small and offer little or no financing platform for SMEs. The capital markets also offer little liquidity and this has been a point of serious concern amongst SME owners.
NSX
The report recommended that the Namibian Stock Exchange (NSX) create special tier-based SME segments to enable easier listing of SMEs, with support from private financial institutions.
In addition, SME visibility to the broader investment base can be described as the third most challenging obstacle SMEs face. Visibility is crucial for investors, as most investors do not attend seminars or start-up events.
More public and private funding is needed for training and support programmes to handle the high demand. In addition, experienced and qualified trainers should be used while industry experts should be brought in to cover specific sectors.
Lastly, governmental support, specifically targeted at SME development, is critical for their success. Costly business registration costs, longer business and trademark registration times, taxation regulations that are not supportive of SME development, and nepotism and corruption affecting SME funding and tender opportunities have all hindered SME development in Namibia. The detailed research paper is available on IPPR’s [email protected]
Kommentaar
Republikein
Geen kommentaar is op hierdie artikel gelaat nie