On account of its capacity to spew millions of employment opportunities, create wealth and alleviate poverty, the small and medium enterprise, SME, sector is acknowledged globally as the engine of economic growth. The importance of this critical sector is not lost on most developed economies of the world, which is why they have made deliberate efforts to create the enabling environment for SMEs to thrive. One of such deliberate efforts is the opening up of unlimited access to technical and financial opportunities to SMEs and removal of infrastructure and other trade barriers to their operations. Although this has not been the case in most countries in Africa including Nigeria, there is now a new consciousness on the need to deepen and widen the financial and technical services availability to SMEs and also develop sustainable markets for their products and services.
The Bank of Industry, BoI, Nigeria’s oldest development financing institution, is in the vanguard of the renewed campaign to expand access to technical and financial opportunities to SMEs in Africa. To this end, the bank, in partnership with Western Union and United States, US, Agency for International Development, USAID, African Diaspora Marketplace, organised a two-day forum aimed at expanding opportunities for the next generation of African businesses. It was the second edition of the SME Live Interactive Forum organised by the bank for the purpose of fostering financial growth for small businesses. Held at the Civic Centre, Victoria Island, Lagos, from November 4 to 5, the event drew more than 100 business leaders from the continent’s SME sector, each presenting an innovative business plan, to leading Nigerian and pan-African banks.
For BoI, the forum was not a happenstance. It has, according to Evelyn Oputu, its managing director, been working with SMEs for more than a decade, which underscored the key role in not only driving growth, but also job creation. “This 2nd annual event is unique, bringing together great banking partners who have recognised the role of SMEs in development and are willing to help address issues they face in accessing financing,” she explained. One of such partners who have recognised the critical role of the SMEs in driving development is Western Union, a global payment services provider, providing consumers and businesses with fast, reliable and convenient ways to send and receive money around the world. “When our customers’ businesses grow, national and regional economies benefit,” says Aida Diarra, regional president (North Central and West Africa) for Western Union.
Diarra explained that Western Union strives to equip individuals with the tools and resources that they need so that they can achieve growth. “The sacrifices that many of our customers make to start up a business can be lost without the tools to maximise their investments through remittances, Diaspora investors or institutional partners,” she explained, adding that SMEs representing key sectors such as information and communications technology, ICT, agri-business, manufacturing and renewable energy will be among those being reviewed by about 12 Nigerian and pan-African banks. Training workshops to help further develop SME capabilities are also part of the initiative.
Diarra told the magazine in an interview that the decision of Western Union to partner BoI was to drive financial inclusion. “We believe at Western Union that the core of our business is about financial inclusion; we bring financial services to people who typically may not have had access to financial services. So, for us partnering with BoI and USAID in an initiative that will empower SMEs to have access to funds and technical assistance is another way to facilitate financial inclusion that will lead eventually to economic development,” she said, noting that the programme was to engage and put the participants more directly into interaction with the banks.
Robin Sanders, former US ambassador to Nigeria, also threw her weight behind the campaign to revive the SMEs by opening up opportunities for technical and financial support for them. Her words: “Developing new approaches and opportunities that generate sustainable financial empowerment requires coordination and alignment across all sectors. A partnership between BoI and the African Diaspora Marketplace links the private sector, government leaders and global community to collectively make a significant and positive impact to help SMEs.”
An important aspect of the initiative is perhaps the recognition of the impact of women entrepreneurs, which is why the initiative emphasises financial opportunities and mentorship for women business owners, including participants from the US State Department’s African Women’s Entrepreneurship Program. According to recent studies by USAID, $1 in female hands is worth $10 (and in some cases $20) in male hands.