admin30 percent had been able to access those funds.
The survey showed that most SMEs were seeking cash to fund their operations while some needed funds for capital expenditure. The amounts needed varied between US$1 000 and US$900 000.
“Banks should be able to give loans to SMEs without collateral provided the project is bankable. They should place measures where possible to safeguard their funds from misuse by borrowers,” a respondent in the survey said.
They said collateral was proving to be very difficult because most of them did not have that as they were still growing their businesses.
SMEs also noted that a good business plan and its capability to grow as well as create employment should be enough reason for banks to support an emerging SME
Out of the 100 respondents that were interviewed during the survey, 79 had applied for loans below US$50 000 while 21 wanted loans above US$50 000.
It has often been noted that most SMEs do not have bank accounts and are not playing their part in contributing towards the fiscus despite having the potential to lead the economic growth of the country.
However, an analysis of the survey showed that 91 SMEs in the sample had bank accounts but only 30 had had their applications for funding accepted.
SMEs also expressed the sentiment that banks need to take them more seriously and offer them interest rates that would encourage growth in the sector.
Only 12 percent of the survey population said they needed loans below US$5 000 and 58 percent expressed willingness to cluster so that they could be able to access finance from the banks.
SMEs noted that it was easy for funds to be put to a different use to that it was originally borrowed for hence there was need for business workshops which would equip the SMEs with correct skills.
“Workshops should promote networking and weaving as some SMEs fail to penetrate markets for their products and services.
“We also need protection and favourable regulations from authorities and protection against competition from companies from other countries and big local companies,” they said.
Online Reporter