Africa-Press – Namibia. NEARLY 500 small and medium enterprises (SMEs) sought relief and support between April 2020 and March 2021, yet only 177 applications were approved for funding.
This is the reality of SME owners in Namibia in their hunt for funding amid what some describe as unrealistic requirements. Economist Salomo Hei describes this struggle as the biggest handicap in the Namibian economy.
Pollen Finance, which set up shop in Namibia in 2018, funds SMEs which have been operating for at least 12 months. Country manager Titus Amoomo says the company understands the struggle of SMEs, since they are entrepreneurs themselves.
“Many businesses cannot put up security like in the formal market, and some just need money immediately. We want to service this growing need by SMEs to access funding for business growth,” he says.
Amoomo says the company aims to assist SMEs as soon as possible. Pollen Finance, of which the head office was established in 2015 in South Africa, has helped businesses with up to N$700 million in short-term loans in less than two years.
According to their website, they are backed by the Anglo African Group, an investment company in Stellenbosch which has been financing SMEs since 1994.
Pollen Finance requires that the SMEs have a banking history of at least 12 months as well as an average profit margin of N$20 000. They also require SMEs applying for financing to cover the credit insurance on the loan extended to them.
Amoomo says the company has offered relief to companies in different sectors, including tourism, retail involving liquor, gambling houses and sport, churches, and private schools.
Manna Supermarket boss Laurien Witschas says during the pandemic the shop needed to prioritise buying stock over repaying their loan, and Pollen Finance allowed them to do so without hesitating.
“When I wrote to them to say I cannot pay, they were not funny about it, but understood my situation. I waited for more than a week, but once I got the money everything went smoothly, and I have gone back for a second loan,” she says.
Omu Kakujaha-Matundu, an economist and academic from the University of Namibia, says SMEs find themselves between a rock and a hard place. “Without a track record, it is extremely difficult to access conventional credit/financing from commercial banks,” he says.
Kakujaha-Matundu says most SMEs are small, and producing on a profitable scale to guarantee their sustainability is hard. “That is why the government tried specialised lending institutions and facilities, such as the SME Bank and the Development Bank of Namibia for SME financing,” he says.
Despite this, the economist says SMEs are still plagued by a myriad of problems related to scale, skills, product quality, competition, shelf space, and external markets.
“With all these constraints SMEs will always find it difficult to grow and become sustainable. The government and other agencies should become more aggressive in supporting SMEs,” he says.
For More News And Analysis About Namibia Follow Africa-Press
