Commercial banks, others dared to finance SMEs

Minister of Trade and Industry Simplex Chithyola Banda has challenged banks and other financial institutions to lead in financing small and medium enterprises (SMEs) to facilitate trade and local industrialisation.

Speaking in Lilongwe on Friday during a public lecture organised by Unicaf University in collaboration with the National Planning Commission (NPC), the minister said financial institutions have a key role to play in the industrialisation drive in line with Malawi 2063, the country’s long-term development strategy.

“Malawi 2063 will not be realised and Malawi become inclusively wealthy and self-reliant nation if banks and other private financing institutions do not provide tailor-made financing solutions for SMEs,” said Chithyola Banda.

Unicaf University vice-chancellor Robert Ridley said the academia can help in facilitating financial literacy and inclusion which could spur SMEs development and local industrialisation.

One of the guest speakers, Bankers Association of Zambia chairperson Mizinga Melu said SMEs represent 99 percent of all businesses, 70 percent of all jobs and contribute 50 percent to the gross domestic product in high-income countries across the world.

“SMEs success can be anchored on strategic elements such as access to affordable finance like working capital and trade finance, access to local and international trade markets, access to world- class insurance services and access to business-based information,” he said.

NPC director general Thomas Chataghalala Munthali said what is needed is to support SMEs with financial products tailored to their core needs for inclusive wealth creation. “SMEs provide the greatest potential in creating meaningful jobs, accelerating economic growth, creating wealth, prosperity and improving livelihoods,” he said