Small and medium enterprises (SMEs) have an opportunity to tap from the K1 billion start-up fund courtesy of a Dutch firm, Accesserator.
The firm’s country director Patrick Namakhoma revealed this on Wednesday on the sidelines of Accesserator Magazine 2018 discussion programme in The Netherlands, which was monitored live on YouTube.
The event was held under the theme Is investing in Entrepreneurship the Future of Africa?
Namakhoma said the fund, which is targeting local start-ups and scale-ups, seeks to build partner capacities to explore market and set up marketing or sales contracts with buyers.
Each firm has a maximum utilisation of $100 000 (about K74 million).
He said: “This is an investment not a loan. We become shareholders for a period of five years. To qualify, one just need to send us their business plan. We realise that Malawi is poor with high unemployment rate, but is peaceful and fit for investment.”
In an earlier interview, Chamber of Small and Medium Enterprises executive secretary James Chiutsi welcomed the initiative, saying banks do not favour SMEs because they are mostly looking for quick returns from the SMEs.
“Banks do not aim at partnering SMEs to see them grow evidenced by the absence of no reasonable grace periods before the loan repayment starts. This encourages more SMEs to engage in pure trading than production ventures,” he said.
Chiutsi said SMEs believe that because government provides banks with substantial business, it makes them less inclined to develop more conducive product portfolios for SMEs.
Since its establishment in 2017, the Dutch firm has helped create 11 businesses in Malawi with an initial investment of K180 million.
Through the firm’s extensive network, it locates profitable businesses and committed entrepreneurs such as cattle farmers, bee-keepers, smokeless-briquette makers and soap and detergent producers to boost their businesses.
The Accesserator model of investing is key in boosting the country’s economy through expansion of businesses and Malawian-based ownership of the companies.
A number of studies have stablished that access to finance is one of the impediments to the growth of SMEs.