Applicants’ post-action impressions

Empretec Business Forum: National dialogue on difficulties in accessing finance for development of SME’s in Ghana

SME’s in Ghana generally, complain bitterly about the lack of access to finance support from the banks, whereas the banks also complain about the problems and risks they endure when dealing with SMEs. Empretec Business Forum (EBF) with financial support from the BUSAC Fund initiated an action titled “National dialogue on difficulties in accessing finance for development of SME’s in Ghana” with the view of addressing and bridging the divide between the SMEs and financial institutions/banks to facilitate business between some segments of demand and supply for finances within the economy.

Through research studies, the views of SMEs and financial institutions across the country were collated and discussed at workshop sessions for selected representatives of SMEs and the financial institutions in Accra and Kumasi. According to R. Hinson, the Executive Director of EBF, a major feature of these workshop sessions was the fact that, though all the financial institutions were invited and expected to be part of the workshop discussions, only a few of these institutions responded to these invitations. Also in all instances, the calibre of personnel that represented the institutions were not persons in the decision-making management positions.

The various positions of SMEs and that of the financial institutions with respect to business financing through this action, are now very clear, even though the differences are still quite wide. However, through this EBF initiative, there has been some movement from both sides of the divide, towards each other. The SMEs have recognised the need to develop capacity to meet prerequisites demanded by financial institutions; and some Banks such as Ecobank, Barclays and Standard Chartered have now developed packages that help SMEs meet their demands prior to receiving financing support. Amalbank also, in collaboration with AGI has also developed a package for SME financing.

This reality notwithstanding, no single bank or financial institution has taken any special interest in the outcomes of this advocacy action. Unique Trust Financial Services was very accommodative of the positions of SMEs during informal discussions, but failed to demonstrate this accommodation at any of the formal discussions and dialogue held as part of this advocacy action. The Government’s 2006 budget shows a lot more about SME support. The budget also stated the establishment of the Venture Fund to provide financing support to SMEs but this cannot be said to be a direct result of this action though, it definitely makes EBF happy.