SMEs need start-up capital, can’t get bank loans: Official

A SMALL-to-medium enterprise (SME) has been likened to a child told to go out and catch a big fish without being given the appropriate fishing gear and the skill to catch a big fish.
Alice Gawi, the accountant of the Bismark Distributors and Agent and Niugini Debts Recovery Solution Ltd, made the remark during the signing of the memorandum of understanding between Tehilla Universal Engineering Services and Nupman Holdings Ltd, a landowner company of Ok Tedi Mining Ltd.
Joining them were eight SMEs in the New Guinea Islands in Kokopo, East New Britain last Tuesday.
Gawi said the Government’s plans were full of terms which were meaningless if there were no access to start-up capital.
She said the policy-makers “think they can park SME funds into commercial banks and invite SMEs to obtain loans with minimal loan interests or tax holidays”.
She pointed out that SMEs needed a mobilisation funding for start-up capital because most could not get collateral funding to obtain loans.
“That is why they don’t go to the banks,” she said.
“Furthermore, the road to the bank (has) so many sharp turns that many give up on the way.”
Gawi questioned the provincial government and ENB’s four district administrations if they had allocations in their annual provincial service improvement programmes, district services improvement programmes funding to support SMEs in the province.
“If so, how do we access them and we have tried without success and our business proposals are probably dust in your offices,”she said.