Govt, RBZ work on SMEs collateral policy

THE Government is in the process of crafting a policy which will enable Small to Medium Enterprises (SMEs) to access funding from financial institutions using moveable assets as collateral, a Cabinet Minister has said.

Officially opening the four-day Hwange Annual Exhibition Show yesterday, Small and Medium Enterprises and Co-operative Development Minister Sithembiso Nyoni said her ministry in collaboration with the Reserve Bank of Zimbabwe (RBZ) was in the process of drafting a Bill that would enable SMEs to access loans from banks to start or recapitalise businesses in the wake of the difficulties the emerging entrepreneurs face in their efforts to grow their enterprises.

"We are in the process of crafting a policy together with the RBZ whereby people can use their machinery, furniture and livestock among other moveable assets as collateral. Most people are failing to start businesses because of lack of immovable assets such as houses thus I am encouraging SMEs to start businesses because there is something which we are working on but it's still in the pipeline. The Bill is still at the drafting stage," said Minister Nyoni.

She said there were a number of initiatives aimed at supporting SMEs, which the Government has put in place after realisation that the sector plays a pivotal role in the country's economy.

"I am aware of the challenges you (Matabeleland North SMEs) face of having to travel to either Bulawayo or Harare to get basic services such as vendor numbers, company registration and passports. The Government is working flat out to ensure that such services are decentralised even up to district level. This is being co-ordinated by the Office of the President and Cabinet under the Ease of Doing Business initiative," she said.

Minister Nyoni encouraged SMEs to register so as to formalise their businesses.
Minister Nyoni applauded the Hwange business community for forming the Hwange Indigenous Business Association Apex last year, which is home to over 2 000 SMEs.

Minister Nyoni said SMEs in Matabeleland North should explore the opportunities that come with utilisation of the abundance of livestock in the province through adding value to the hides after slaughter.

"I would like to encourage SMEs in all districts to set up hide collection, processing and selling centres down to village level so that villagers can earn revenue from the sale of these hides. Youths and women should form groups to collect, process and sell these.

"My ministry and other technical partners will assist with the training on how to process the hide into leather (value addition) and also in production of leather products. A leather products training course for youths is currently underway in Binga district with the help of funding from Silveira House," she said.

Among the dignitaries that graced the exhibition were Minister of State for Matabeleland North Provincial Affairs Ambassador Cain Mathema, Victoria Falls Mayor Councillor Sifiso Mpofu, Hwange Local Board chief executive officer Mr Ndumiso Mdlalose and various provincial and district Government departments heads.