Banks included in support fund

ALL major banks and financial institutions have been included in the Government’s initiative to support the small and medium enterprise (SME) sector with K200 million funding support, a senior official says.
Small and Medium Entrepreneurs Corporation (SMEC) acting managing director Petrus Ralda said apart from Bank South Pacific (BSP), banks, including Kina and Westpac and other financial institutions, would be included in the initiative.
Ralda made this known after queries were raised by businesses, who deal exclusively with Kina and Westpac, on whether all commercial banks would be part of the SME funding programme.
Ralda said the decision was made that by next year, other banks would come on board to roll out the programme.
He said of the K200 million funding allocated for the initiative, K100 million was given to BSP, K80 million to the National Development Bank (NDB) to roll out SME programmes and K20 million was for the Department of Commerce and Industry as administrative support.
“Out of the funding, we will work with NDB and BSP to run capacity building programmes to allow the SME sector to access the funds through consensual loans,” he said.
Ralda said NDB would give loans out on fixed interest rate.
“This is a pilot project,” he said.
“It is a long term sustainability programme and other banks and financial institutions will come on board next year.
“It is not that the Government selected some banks and omitted others.
“It is a pilot project and we will need the support from every key stakeholder,” he said.
Ralda said the Government’s focus now was on the SME sector with particular interest on developing agricultural SMEs.
He said the government’s vision was to change structure and set a vision to enhance sustainable economic development.
He said the country was overly reliant on the extractive industry but other industries and sectors needed to be developed to sustain and support the economy as well.
“This is why the Government is looking at the sustainable sectors like agriculture, tourism, businesses and others that would sustain the economy in the long run,” he said.
Ralda claimed that 85 per cent of the population depended on the SME sector and this was why the Government refocused on developing this sector.
He said plans were in place to involve all stakeholders in the SME sector so that can sustain the economy in future.
“The church and district development authorities (DDAs) are also key stakeholders in this plan,” Ralda said.