Support for SMEs’ economic growthSmall and Medium Enterprise (SME) development is a priority for governments and financial institutions worldwide.
This statement was made by Bank Windhoek’s Executive Officer of Business Banking, Leon Koch, when he announced that the bank had completed all necessary arrangements to support the Namibian Government’s SME Economic Recovery Loan Scheme launched in February 2023.
In his statement delivered earlier this week, Koch said the World Bank financial statistics found that SMEs generate the most formal jobs in emerging markets.
“It further says that 600 million jobs will be needed by 2030 to absorb the growing global workforce, making SME development a priority for governments and financial institutions worldwide,” he said.
“However, access to finance is a crucial constraint to SME growth. It is the most cited obstacle facing SMEs in growing their businesses in emerging and developing countries. Bank Windhoek is delighted to announce its support to the Namibian Government’s SME Economic Recovery Loan Scheme.”
The SME Economic Recovery Loan Scheme is an initiative introduced by government in partnership with several local banking institutions, including Bank Windhoek and the Bank of Namibia.
“It is an action plan to assist SMEs to stimulate economic growth and job creation by providing them with additional funding to continue paying their operational expenses, retain employees and maintain financial stability in Namibia,” said Koch.
He added that through this scheme, Bank Windhoek would extend loans to qualifying SMEs at the Prime Lending Rate of less 0.5 %. “The obligation to pay the interest and capital on these loans will be deferred for six months from the day of signing the agreement,” said Koch.
The economic slowdown since 2016 severely impacted businesses and SME businesses specifically. The government created the scheme to assist SMEs during challenging financial situations.
Koch said that one of the critical qualifying criteria for Bank Windhoek is that the SME customer should have an existing relationship with the bank through lending or transactional banking. “They should also be a registered business entity with the Business and Intellectual Property Authority (BIPA), including a sole proprietorship. The customers should also have a maximum annual turnover not exceeding sixty million Namibia dollars per annum,” he said.
Koch emphasised that to qualify for assistance, the applicant should not have previously participated or have any existing SME Economic Recovery Loan with Bank Windhoek or any other financial institution.
To apply, SMEs can visit any Bank Windhoek branch. Alternatively, they can contact the Bank’s Customer Contact Centre at Tel: +264 61 299 1200.