HARARE – Small and Medium Enterprises (SMEs) have so far drawn down 45% of the $451 million SMEs facility put up by the Reserve Bank of Zimbabwe (RBZ) to capacitate emerging businesses.
Speaking on the side-lines of the FBC SME Banking workshop last week, RBZ principal bank examiner Gideon Charumbira told the Business Times that the central bank’s empowerment initiatives will go a long way in assisting informal businesses to formalise and enhance their contributions to the national fiscus.
“As at May 4, 2018, a total of $201,06 million had been disbursed under various empowerment facilities.
“The facilities have had significant impact in supporting production for both export and local consumption. The funded activities have been instrumental in developing various value chains particularly in agriculture, mining, manufacturing and tourism.
“Further, in line with the financial inclusion thrust, a number of banking and microfinance institutions are providing financial support to the marginalised groups using own funds in addition to the central bank facilities,” Charumbira.
Affordable finance is seen having a significant positive impact on people’s livelihoods while at the same time stimulating economic growth.
According to the World Bank, SMEs are creating four out of every five new jobs currently. However, more than 50 percent of SMEs in emerging markets lack access to finance and this hinders their growth.
SMEs are the engine of economic growth and development in Zimbabwe contributing more than 60 percent of the country’s GDP.
According to the FinScope MSME Survey of 2012, SMEs employ approximately 5,7 million people (2,8 million business owners and 2,9 million employees).
SMEs are believed to account for over 45% of the country’s formal employment and 33% of national income. Over the years, SMEs have suffered a myriad of challenges including lack of capital, infrastructure and markets.
The Reserve Bank of Zimbabwe (RBZ) has put in place 12 facilities to help small businesses grow.