Financial relief for SMEs
DBN launches KfW business relief loans
14 January 2021 | Banking
The loan term will be a maximum of 60 months.
According to the bank, these relief loans will be available to both existing DBN SME borrowers and to enterprises that are not yet clients of the bank, as long as these enterprises have been in operation for at least 12 months, and meet the qualifying criteria.
Information on the qualifying criteria can be obtained from the bank’s website as from Monday, 18 January 2021, or on information pamphlets available at all DBN offices in the course of late next week. These can also be emailed to interested parties on request.
The DBN and the Development Bank of Germany (KfW) concluded a N$450 million concessional loan agreement. The DBN will on-lend the money to Namibian SME enterprises that require bridging capital to carry them through the low-revenue earning period caused by the pandemic and enterprises that wish to restructure their business operations, to best survive in the changing business environment.
DBN chief executive Martin Inkumbi says it is hoped that the financial intervention will contribute to preserving continuity of SME business activities and to build a foundation for recovery. Although the bank will – through its normal SME lending – continue to finance SME start-ups, the priority for the Covid-19 business relief loans will be to preserve business continuity and preserve jobs, and therefore these loans are targeted at existing enterprises.
DBN forecasts that the funding will offer financial relief to around 200 SME’s. The bank will customize the loans based on individual enterprise needs. Industries such as tourism, hospitality, and transport and logistics that have experienced the largest loss of revenue due to lockdown-related effects will be prioritised.
The facility may also be used for diversifying into new business areas that help strengthening resilience of existing companies for future shocks.