$3m boost for SMEs

Charity Ruzvidzo Business Reporter
THE disbursement of the $3 million loan fund for Small and Medium Enterprises (SMEs) is expected to start this month-end.

Parliament last year ratified the $3 million facility meant to finance operations of micro, small and medium-scale enterprises that was obtained from the Arab Bank for Economic Development in Africa (ABEDA).

The loan facility was signed by Finance and Economic Development Minister Patrick Chinamasa and the ABEDA in Sudan last year.

The loan has a concessionary interest rate of one percent and a tenure of 20 years with a five-year grace period.

Minister Chinamasa said $1.2 million of the Arab Bank loan would be channelled to small enterprises while $900,000 would be for medium enterprises.

ABEDA has also expressed interest in funding development projects in the country depending on the performance of the $3 million facility.

Small to Medium Enterprises and Co-operative Development Minister Sithembiso Nyoni told Business Chronicle on Wednesday that paperwork for the disbursement was still being finalised by the relevant authorities.

“The $3 million loan facility for SMEs has not been disbursed yet. The paperwork is still being finalised but we expect the money to be disbursed by end of month or the first week of April,” she said.

Minister Nyoni said the loan fund is expected to address the challenges faced by SMEs.

“The loan will provide working capital for SMEs. This will help boost their businesses. SMEs must use the money to develop and expand their projects,” she added.

Her ministry has adopted a linkage programme between SMEs and established companies to boost local trade and skills.

Meanwhile, Minister Nyoni said the SMEs registration process she rolled out early this year was on-going.

“The registration process of SMEs is an ongoing programme and so far it’s going on well,” she said.