Bill seeks to protect SMEs from payment defaults
Ministry of Trade and Industry says the Small and Medium Enterprises (SME) Bill is expected to be tabled in the next meeting of parliament depending on Cabinet approval.
The Bill seeks to create an authority that will regulate the SME sector.
Ministry of Trade and Industry director of SMEs and cooperatives Limbikani Kachiwaya said in an interview that all the processes of drafting the Bill have been finalised.
He said they decided to develop the SME incubation strategy before the Bill is tabled and passed into law in order to first build capacity of the SMEs in trading under the new law once it is in place.
Kachingwe further explained that an SME portal has been developed and when fully operational it will be linked to all government and private institutions, with interest in SMEs, for data access and profiling.
National SMEs executive director William Mwale said the Bill has been in draft form for too long, which is delaying transformation of the sector that has potential to boost the economy.
Among others, the law will transform the SME Development Institute into a regulatory authority that will, among other things, regulate business incubation firms.
The Bill, according to Kachiwaya, will also protect suppliers that do business with government, nongovernmental organisations and corporates in cases of late payments, saying the defaulters will incur interest charges for the default period.
The Bill further seeks to transfer the interest costs charged during the period of delayed payment to the suppliers
The current progress in processing the Bill, which has been in development for decades, is being financed by the Financial Inclusion and Entrepreneurship Scaling project by Reserve Bank of Malawi with a loan from the World Bank.
