The Nation Newspaper

Tag: SMEs’

  • CWG showcases platform for SMEs

    Pan-African Information Technology company, CWG Plc is presently participating in the Enugu SME Week, where it is showcasing the company’s Enterprise Resource Planning platform built to enable Small and Medium Enterprises (SMEs) manage their business operations efficiently.

    The Buisness Development Manager, (SMERP), Mr ChidiebereAsiegbu, said its participation at the event is in line with its strategic intent of deploying technology solutions that enables growth, especially for the SMEs segment of the Nigerian economy, which accounts for over 25 percent of employment in the country.

    Asiegbu, said with SMERP SMEs can easily setup an E-commerce website with different categories of products, adding that the solution is suitable for any business like retailing, hospital management, manufacturing and school management.

  • IFC, others plan solar power for SMEs

    Thousands of Small and Medium Enterprises (SMEs) in Nigeria would benefit from solar energy programme being put together by the International Finance Corporation (IFC), the Department for International Development (DFID) and local financial institutions.

    The Country Manager, IFC, Eme Essien Lore, in an interview with The Nation in Lagos, said the IFC was partnering DFID and banks in Nigeria to achieve this goal.

    She said IFC through its off-grid and embedded solar market development and finance programme, would provide solar power to willing SME owners.

    She added that the programme ensures that IFC, the Department for International Department (DFID), and banks in Nigeria partnered to provide technical and financial support for owners of SMEs that are interested in accessing solar power for operation.

    According to her, the banks, through their Energy or Oil and Gas units, would disburse loans to SMEs, in order that they could  access solar electricity for their operation.

    She told The Nation that some selected local financial institutions would be used by the IFC to provide technical and monetary supports to owners of small and medium scale enterprises in the country, adding that the Corporation was undertaking the programme for SMEs owners because it was cheaper and easy to install when compared with coal, biomass, wind and other renewable energy sources.

    Lore said IFC was working with the Department for International Development to improve access to electricity and further contribute to the growth of the Nigerian economy.

    “IFC plans are to provide thousands of SMEs with solar energy, improve economies and create employment opportunities in Nigeria and Africa in the next 10 years. We intend to make use of the abundant Sun light in Africa to achieve our goal of providing off-grid electricity through solar energy. IFC has provided about $3.5billion for renewable energy projects such as biomass, hydro, solar and wind, globally and wants to do more.

    “Through solar energy, people produce electricity they need and reduce transmission losses to a great extent. In the grid method of power generation electricity there are huge transmission losses due to weak facilities and to avert the losses, a lot of money and expertise are required.”

    Also, the DFID’s representative in Nigeria, Ben Mellor, said the government of United Kingdom (UK) was interested in improving off-grid electricity in Nigeria to promote growth. He said off-grid electricity serves as a viable option to meet the needs of people in the low income segment of the economy, stressing that solar and other off-grid electricity would help in improving businesses in such areas when deployed.

    “Access to energy is one of the most critical needs in Africa and particularly Nigeria. Based on this, the UK Department for International Development is determined to assist in bringing solar technology financing solutions to smaller businesses and corporates and we are working with IFC to achieve this goal,” he said.

  • IFC, DFID partner to improve SMEs’ access to electricity

    International Finance Corporation (IFC), a member of the World Bank Group and United Kingdom’s Department for International Development (DFID) are partnering to facilitate the deployment of off-grid and embedded solar systems in commercial and industrial sectors of Nigeria.

    According to an official of IFC, Ejura Audu,  the ultimate goal was to help corporate organisations and small and medium scale entrepreneurs (SMEs) to have better and more reliable access to electricity, utilising the country’s abundant solar resources.  He added that this would contribute to Nigeria’s economic growth and greenhouse gas emission reduction.

    Through this deal, IFC’s Off-Grid and Embedded Solar Market Development and Finance Programme, and DFID’s Solar Nigeria Programme will launch a new programme for solar market development and finance.

    One of the major components of the partnership is the provision of technical support and financial instruments to financial institutions.This will help them develop business solutions for the emerging solar market, especially solar PV technology investments in Nigeria.

    The programme is being launched at a workshop that will share market study findings, present the key components of the programme implementation phase, and collect feedback from stakeholders.

    DFID Nigeria’s Head of Office, Ben Mellor, said: “The UK Government is committed to helping to increase investment in off-grid energy and accelerating the delivery of solar energy systems that will help improve access to energy for more businesses. As access to energy is one of the most critical business needs in Africa, particularly Nigeria, the UK’s Department for International Development is determined to assist in bringing solar technology financing solutions to smaller businesses and corporates,  and we are working with IFC to help implement these solutions.

    “IFC has been at the fore, creating and facilitating solutions to help increase access to energy at the home and corporate levels in Nigeria,” said Eme Essien Lore, IFC Country Manager for Nigeria.

    “The solar market has the potential for quick wins in bringing access to electricity for more businesses as it takes less time to install. It also enables production of electricity at the point of need, which eliminates transmission losses to a great extent. We are working with DFID to accelerate access to electricity for more businesses and help contribute to economic growth in the country,” she added.

    The programme is part of the World Bank Group’s Energy Business Plan for Nigeria where each institution in the World Bank Group (IFC, IBRD and MIGA) will leverage their competencies and products to provide solutions for projects and sustain the power sector.

    Over the past three years, the IFC has financed close to $3.5 billion in renewable energy projects worldwide, including biomass, geothermal, hydro, solar, and wind.

  • Development Bank of Nigeria gets $1.3b for SMEs financing

    Development Bank of Nigeria gets $1.3b for SMEs financing

    • Emefiele: ‘No disharmony with Minister’

    The Federal Government has set aside about $1.3 billion to support Small and Medium Enterprises (SMEs) in the country. The fund will be managed by the Development Bank of Nigeria (DBN), the Minister of Finance, Mrs. Kemi Adeosun, has said.

    Mrs. Adeosun, who spoke during a briefing with Nigerian reporters attending the International Monetary Fund (IMF)/World Bank Group meetings in Washington DC, yesterday, said SMEs are part of the engine that will spur the growth of the economy. She added that lending at low rates to SMEs will now be facilitated through the DBN.

    According to her, agreement has already been “reached on the final steps for the take-off of the Development Bank  which has been on hold due to some issues.

    “We have resolved all those issues, the recruitment process has now been finalised with the management team now being put in place,” she said, adding that the “DBN is for SMEs and many of them are traders that don’t qualify for bank loans, such as facilitated by the Bank of Industry (BoI).  The focus of DBN is SMEs and giving them low cost loans.”

    The media chat was witnessed by the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, her Permanent Secretary, Dr. Mahmud Isa Dutse, Deputy Governor, Economic Policy, Dr. Sarah Alade and Director-General, Debt Management Office (DMO), Dr. Abraham Nwankwo, amongst  other senior officials from the CBN.

    Also speaking, Emefiele said it was not true that there was disharmony between fiscal and monetary authorities on interest rates, saying “we feel that when people are able to access loans at low interest rates, it helps improve growth, reduce unemployment and boost industrial capacity.”

    He said based on the available data, the CBN’s Monetary Policy Committee (MPC) felt  it could pursue growth through another angle, pointing out that “it has nothing to do with disharmony.

    “I feel it is important for me to also join the minister to confirm that there is no disharmony. We are all working together and I believe that in due course, we would achieve the growth that we badly desire for the country,” he said

    Mrs. Adeosun said so far, the government has “been able to crowd in money to the tune of $1.3 billion from the World Bank, the African Development Bank (AfDB) and the European Investment Bank. We have made a lot of progress now and are ready to take off. We have advertised for the management positions and when appointed, they would be able to complement the work and build synergy with the CBN intervention. We need to get the money into the hands of smaller businesses that make up 50 per cent of our GDP.”

    On illicit financial flows, she said the Nigerian delegation to this year’s IMF/World Bank meeting “has some high level discussions with a number of countries where we have Nigerian money domiciled; when we talk about illicit financial flows, there is a number of issues involved- those from corrupt practices, tax evasion, tax avoidance and those who under pay tax. But we are working hard to bring them back to the country.”

    On Nigeria’s foreign loans, she said: “We are through with the AfDB and ready to go to the Eurobond. It is just to appoint the parties. It is particularly the issue of pricing, not the volume. We are going to look into how we can refinance some of our existing Naira debt into the international market to take advantage of the low international rates now. This would lessen the pressure on the domestic market. We have spoken with a lot of lenders and the market is really and very attractive now.”

     

  • SMEs battle to get bank loans, raw materials

    Small business operators have said high cost of raw materials is giving unfair advantage to foreign manufacturers.This is in addition to bank loans being are expensive.

    Speaking in Lagos, President, Association of Micro Entrepreneurs of Nigeria (AMEN), Prince  Saviour Iche said  lack of access to finance is a still a major challenge for smaller and younger companies as small and medium-sized enterprises (SMEs) are unable to invest sufficiently to grow their operations.

    Apart from increase in interest rates of loans, he added that most banks are demanding collateral and other requirements.

    On raw materials used by small business entreprenuers to make soaps, detergents and personal care products, Iche said the cost has gone up to almost 600 per cent on some of them since January, with the price of some products has gone from N3000 to N23, 000 within seven months.

    He added it is becoming challenging for some of them to produce cosmetics because the major raw materials are imported petroleum-based derivatives.

    Despite this, he explained that it was difficult for small businesses to increase price to combat margin pressures in response to rise in raw material prices. Availability of raw materials at cheaper cost, he maintained, would boost small manufacturing and increase job creation across the personal care and cosmetic industry.

    Calling for the development of the local chemical sector, which is mainly petrochemicals, Iche noted that limited development of the sector was affecting local manufacturing which relies on imported raw materials.

    He explained that it was restraining the development of further manufacturing for a wider range of produce involving small businesses.

  • AfDB, Fortis MfB sign N1b loan for SMEs

    AfDB, Fortis MfB sign N1b loan for SMEs

    The African Development Bank (AfDB) and Fortis Microfinance Bank  (Fortis) yesterday signed an agreement for a N1 billion facility to be used for lending to small and medium enterprises (SMEs) in Nigeria.

    A statement from the AfDB explained that the partnership with Fortis is expected to boost Nigeria’s private sector development through financing of projects that are strategically aligned to the country’s development agenda.

    AfDB Country Director in Nigeria, Dr. Ousmane Dore underscored the importance of strengthening micro finance initiatives, adding: “Unless those at the bottom of the pyramid have access to finance, poverty will remain a major development issue.’’

    He re-affirmed the bank’s commitment to promote inclusive, private sector-led growth and employment creation in Nigeria and across the continent.

    Speaking during the signing, Fortis Managing Director and CEO, Tiko Okoye said the deal was significant as it underscored the firm’s desire to empower SMEs in the country.

    “The collaboration with the AfDB has added a significant boost to the realisation of our dreams of empowering more Nigerian households through the SMEs.

    “SMEs across all climes are the engine of most economies, Nigeria and Africa inclusive. A more formidable SMEs sector will lead to a stronger Nigerian economy,” he added.

  • Technology vital to SMEs’ growth, says Matt O’Bell chief

    The Managing Director, Matt O’Bell Ltd, an enterprise resource planning (ERP) provider, Dare Ojo-Bello, has identified technology as one of the key drivers of small and medium scale enterprises (SMEs).

    Speaking in Lagos during the unveiling of OdooSME, a web-based solution that integrates all the functions and strategic business units SMEs with the added value of transparency, productivity and profitability, he said SMEs as the engine of growth of modern economies, must be encouraged to grow and contribute to the gross domestic product of the country.

    He said OdooSME is a business application that allows SMEs to run their businesses more efficiently and be coordinated like many large and multinational organisations.

    While highlighting the features and affordability of the solution, he explained that OdooSME is a suite of Odoo modules delivered as a subscription-as-a-service (SaaS) solution. The modules include accounting, budgeting, fixed assets, account receivable, account payable, general ledger, sales, purchase, inventory, customer relations management (CRM), point of sale (PoS), human resources /payroll, project management, manufacturing, e-commerce, website builder, document management and instant messaging among others.

    He further urged SMEs to leverage on the benefits of enterprise resource planning (ERP) solutions in order to cut out the complexities of paperwork reporting, reduce fictions with tax authorities and fairly compete with large and multinational firms.

    According to him, high cost of accessing technology has been addressed with the solution which he explained goes for as low as N500/user per month with a 30-day trial before commitment to payment comes with additional benefits such as high availability, training and implementation assistance, backups, software upgrades and support.

    He said: “The SME business is not different from the business of large organisations and even multinationals. If big companies leverage on technologies for efficiency and profitability, SMEs should not be different. Most SMEs don’t keep records and the few that do only record accounting transactions. This has left a huge hole in the compliance and access to information that is key for decision making. Although cost and complexity of available solutions was a huge limiting factor, but OdooSME has eliminated this.”

  • $1b coming for Nigeria, others’ SMEs

    Three organisations, Norfund, Netherlands Development Bank (FMO) and Rabobank, have set aside $1billion to lift the small and medium enterprises (SMEs) food sector in Nigeria and other African countries.

    Another firm, Banco Montepio, a financial group based in Portugal with banking investments in Africa, is also expected to join the partnership. The aim is to promote continental economic growth.

    Rabobank is a Dutch cooperative bank founded by farmers while Norfund is the Norwegian Investment Fund for Developing Countries.

    Norfund, FMO and Rabobank, hold stakes in several financial service providers (FSPs) in sub-Saharan Africa, which they have agreed to pool together.

    The firms have resolved to start a new company, to be named Arise. The company will start in over 20 countries, a $660 million in assets and it is expected to grow to $1 billion. Arise will take and manage minority stakes in African FSPs.

    Through Arise, the partners will continue to adequately support the growth and development of the FSPs by providing among others, technical assistance and management services in the field of governance, management, marketing, innovation, compliance and risk management.

    Capital will also be allocated for new investments.  Arise will be operational from January 1 next year.

    Executive Director, Rabobank, Berry Marttin said: “Rabobank’s activities in investing and building strong financial service providers in emerging economies, especially sub-Saharan Africa, truly fit our Banking for Food strategy; focused on creating solutions with our clients to feed the world in 2050. It is, therefore, very important to us to take this approach to a higher level. By joining forces and pooling assets, networks and expertise with Norfund and FMO, two highly experienced development institutions of excellent reputation, we are taking a major step forward.”

    On the partnership, Chief Executive Norfund, Kjell Roland said: “Norfund invests in financial institutions to strengthen their ability to supply capital and financial services to SMEs and unbanked people in Sub-Saharan Africa and thereby contribute to economic growth and poverty reduction.

  • Group warns of declining revenues, SMEs collapse

    The Association of Micro Entrepreneurs of Nigeria (AMEN) has warned small and medium scale companies to brace for significant declines in revenues this year.

    Its President, Prince Saviour Iche said many SMEs were  closing shop, following the high cost of raw materials and tougher restrictions on foreign exchange (forex) to buy raw materials.

    According to him, SMEs may disappear from the industry, despite their cost-cutting efforts.

    While some SMEs have suffered a downturn in sales, profits have also taken a hit and Iche fears factory closures would be inevitable.

    He said many firms were still mired in hardship, resulting in an increase in dissolved firms.

    Although growth opportunities for SMEs still preside, he said the high operation costs is beginning to impact SME performance.

    He explained that lower revenues is instigating firms to pull back on investment somewhat but business priorities have remained stable.

    Despite the economic challenges, he  said small businesses have continued with fewer resources, adding that some frustration is being seen in the SMEs’ sector at the pace of change and the time it is taking for policy initiatives to be felt among the nation’s small business community.

    Access to credit, he  maintained, still remains the most serious obstacle to the success of small-to-medium enterprises.

    He urged the government to set up a centre for credit services for struggling SMEs.

    He urged the Central Bank of Nigeria (CBN) to  issue policies to encourage commercial banks to set aside preferential capital packages to lend to SMEs.

  • ‘Banks unlock SMEs’ potential with funding’

    ‘Banks unlock SMEs’ potential with funding’

    Banks have crucial roles to play in ensuring that potentials of Small and Medium Enterprises (SMEs) are harnessed by providing tthem with adequate funding, Stanbic IBTC Bank has said.

    According to the lender, stakeholders need to deploy effective  strategy, resources, planning and diligent execution to make SMEs a huge success.

    Head, Business Banking, Stanbic IBTC Bank, Anya Duroha, said the SME sector is key to the economic growth and development of any nation and Nigeria is no exception.

    He spoke at the the Stanbic IBTC Bank 2016 SME Capacity Building Sessions which took place in eight cities across the country.

    He said the need to support SMEs is more pronounced as government attempts to diversify the economy in the aftermath of declining revenue from oil due to plummeting prices.

    He said the series was conceived two years ago to expose SME operators to modern and innovative marketing, financial, and management skills that are useful to their business operations and which will help them to attract the necessary funding for growth.

    The Stanbic IBTC Group, Duroha explained, is backed by the rich heritage and know-how of the Standard Bank Group.

    The bank is also committed to building a strong SME base in Nigeria and one of the ways it hopes to achieve this is by empowering operators with the right business skills and adequate funding.

    The series were designed to contribute to the development of relevant expertise and priorities that would help SMEs flourish, enabling them to play their catalytic role in economic growth.

    One of the biggest causes of small business failure is a lack of sound financial management, stated Eziukwu Princewill, Development Finance Strategist at Visionaries Nigeria Limited, who facilitated at the Abuja session.

    He stated that “to stay in business, there should be vast and keen knowledge of the environmental indices and how they can affect the growth and sustainability of the business.”  economy.