SMEDCO lends $15m to small businesses in 2yrs

Source: SMEDCO lends $15m to small businesses in 2yrs | The Herald November 20, 2019

Nesia Mhaka Herald Correspondent
The Small and Medium Enterprises Development Corporation (SMEDCO) has lent about $15 million in the last two years to boost the growth of small businesses and loan repayments.

SMDECO chief executive Mrs Gladys Kanyongo said this during a tour of an SME firm, Metpole, in Harare yesterday.

She said she hoped to double loans to speed up development.

The parastatal, which is a leading development finance institution for the promotion and development of micro, small and medium enterprises, was formed in 1983 through an Act of Parliament, and provides both financial and non-financial services to its clients, including lending, training, advice, infrastructure provision and capacity building.

This year, it has assisted about 500 000 SMEs nationwide.

Mrs Kanyongo said the institution was keen to play a key role in empowering budding entrepreneurs and contributing to the fulfilment of the country’s upper middle-income status Vision by 2030.

“We would like to double our efforts from the two previous years, all things being equal. In the last two years, SMEDCO has disbursed over $15 million.

“SMEDCO’s role is to promote SMEs by providing funding and development solutions, thus in line with the vision for sustainable economic development so that by 2030, Government will achieve its goal of having an empowered upper middle-class society,” she said.

Mrs Kanyongo said loan repayments have been encouraging, with a collection rate above 90 percent despite the prevailing economic challenges.

“We are encouraged by the resilience of these clients. The upper-cap (loan) is reviewed from time-to-time, informed by SMEDCO’s own capital base,” she said.

At the moment, SMEDCO has an average loan size of about $50 000.

Mrs Kanyongo encouraged SMEs to apply for loans that suit their business requirements and capacity to repay.

She emphasised that SMEDCO would stick to professional guidelines and transparency in disbursing loans and give all stakeholders equal opportunity.

Women’s Affairs, Community, Small and Medium Enterprises Development Minister Dr Sithembiso Nyoni told the same gathering that SMEs require a lot of support for them to grow.

“In order for the Micro, Small and Medium Enterprises (MSME) sector to meaningfully contribute to the economy, there is need for a collaborative and well-coordinated approach to nurture and promote sustainable development of the sector.

“Zimbabwe’s economy is largely driven by SMEs, and it is important for Government to invest more into the sector to maximise on the untapped potential to the mainstream economy,” said Minister Nyoni.

SMEDCO operates six branches in the main cities that serve the 10 provinces. Branch locations are found in Harare, Bindura, Bulawayo, Mutare, Gweru and Masvingo.