Lack of information, poor plan making access to SME funds difficult—LCCI

The Lagos Chamber of Commerce and Industry (LCCI) has said that lack of adequate information and poor business structure are chief factors making access to SME funds difficult.

Babatunde Paul Ruwase, president of LCCI, who said this during a workshop on ‘Preparing SMEs/ Corporates for 2018: Financial Perspectives’ stated that funding has always been available but the problem is that small business operators do not always have the right information.

“It’s just them knowing how to access it. The problem is that they are not structured. They are not well informed. They are not well arranged. They don’t even know what to do.

“The funding is there but being able to access is the problem,” he added.

Ruwase urged micro, small and medium scale enterprises (MSMEs) to study recent policies of government relating to access to credit, payment of taxes, starting a business, trading across borders and execution of contracts to explore opportunities.

“For instance, two bills were signed into law to improve the business environment. We now have the Secured Transactions in Movable Assets Act and the Credit Reporting Act of 2017.

There are also special intervention windows in the foreign exchange market through which MSMEs can access foreign exchange for their imports,” he said.

According to him, now is time to begin to look at possibilities within the system as government continues with the implementation of the Economic Recovery and Growth Plan (ERGP).

He called on the government to continue tackling issues such as multiple taxation, inconsistent policies, poor regulatory environment and insecurity in the country.

Bayo Yusuf, MD/CEO of UBA Pensions Fund, said penchant for business sustainability often pushes entrepreneurs to ignore making retirement plans.

Yusuf said it is not enough to rely on one’s business as one’s long-term plan.

“When we are planning to raise capital or run our business and ensure sustainability, it is important we make our retirement plans.

“Retirement plans are saving and investment plans and will ensure we reap later, what we sow today. It is what you do today to enjoy tomorrow,” he said.

According to him, it is important to have a good record-keeping, an accountant and even a human resources staff member.

“Your taxes as an entrepreneur should be clear, and every staff should know your pay-day. There is a need for monthly performance review and it is only when you are in line with your goal that you can say that your business is your retirement plans,” he explained.

Uloma Ike, group head, micro enterprises at Bank of Industry (BoI), said most SME operators often bring non-bankable business plans, making it difficult for their loan applications to be approved.

Ike said the development finance institution disbursed N29 billion to small businesses in 2017, stressing that BoI is insistent on doing a lot of businesses with MSMEs this year.

She added that the bank is desirous of expanding what it did last year.

She enumerated what an entrepreneur who needs loans should do to include having a registered business, bankable business plan, adequate knowledge of the industry, business management skills, capital outlays and collaterals (if required). She further stated that there are a number of funds available for small business in BoI which are easily accessible.

ODINAKA ANUDU