SMEs want K5 billion stimulus package

 The National Small and Medium Enterprises (Nasme) says it is seeking a K5 billion bail-out package for small and medium enterprises (SMEs) to help them cushion the impacts of the novel coronavirus (Covid-19) pandemic.

Nasme national coordinator William Mwale said the proposal to government has been made after observing that despite the government through the Reserve Bank of Malawi issuing a three-month Covid-19 moratorium for them, majority of SMEs are yet to benefit from the initiative.

He said most of the SMEs have been turned away by the banks, saying they do not qualify for the moratorium.

He said: “Government has proposed K15 billion to be given to SMEs through Malawi Enterprises Development Fund [Medf].

“We are saying that due to unnecessary delays that happen at the institution in disbursement of funds, we requested that we be allocated K5 billion so that we manage it ourselves through our fund and pay them back later.”

Mwale said the funds would carter for ITS 15 000 registered members and other micro, small and medium enterprises nationwide, who will account for over 30 000 when there is a fund to benefit all.

Bankers Association of Malawi (BAM) chief executive officer Lyness Nkungula, in a written response, said the moratorium is for financially distressed SMEs but the problem banks have noted is that almost everyone wants to get a moratorium.

Minister of Finance, Economic Planning and Development Joseph Mwanamvekha last Thursday agreed with BAM that not all SMEs are eligible for the moratorium but those who do not qualify have an opportunity to borrow from Medf.

Other than the moratorium and Medf loans, Mwanamvekha said SMEs in cities will also benefit from social cash transfer to mitigate the impact of Covid-19 pandemic.

Figures from the Ministry of Industry, Trade and Tourism show that the country has about 987 000 SMEs but 98 percent are not registered