MSMES REMAIN HIGH CREDIT RISKY

EZULWINI – EswatiniBank Managing Director Nozizwe Mulela says as banks they are cognisant of the fact that the local MSMEs sector struggles to access finance to grow.

Mulela said this was mainly due to requirements placed by the financial institutions for the micro, small and medium enterprises (MSMEs) to access finance. Mulela said MSMEs are high credit risk making it hard for them as financial institutions to offer funding to them without doing due diligence. She said MSMEs often lack sound collateral, which is one of the requirements for funding.

Recover

She said it is unfortunate that inasmuchas the requirements may be hard for the MSMEs but they have to be put in place and followed because, at the end of the day, the financers have to recover the money offered to MSMEs as loans. Mulela said nonetheless, there are solutions available to this challenge. She said government has provided credit guarantee schemes to assist in this regard. She said as a bank they use the same assets they fund as collateral.

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