Supporting SME sector's resurgence

In the face of a recovering economy, soaring inflation and high interest rates, small business owners in Namibia are navigating challenging times. Now more than ever, supporting small and medium enterprises (SMEs) is imperative, given their significant contribution to the Namibian economy. It is estimated that there are over 40 000 SMEs in Namibia, supporting the livelihoods of more than 200 000 people and contributing approximately 12% to the country’s gross domestic product (GDP). These enterprises, defined as having between one and 100 employees and an annual turnover of up to N$10 million, are a source of innovation and job creation, particularly in rural areas where formal employment opportunities are limited.Having assumed the role of head of SME banking at Nedbank Namibia in June 2023, Sam Ikela highlights the bank&#039;s alignment with the government and the broader financial services industry&#039;s vision to support the economy&#039;s recovery from the Covid-19 pandemic. "With the spotlight increasingly on the SME sector, widely acknowledged as a pivotal driver for recovery, we’re committed to supporting its resurgence," Ikela said. A significant hurdle hindering SME growth globally is the surge in inflation, exacerbated by the lack of access to finance. During the fourth quarter of 2023, more than half of United States-based small businesses cited inflation as their biggest challenge, underscoring the pressing need for financial support and stability in the SME sector."The trend is similar locally," Ikela noted. He highlighted two key initiatives supporting SMEs: The SME Economic Recovery Loan Scheme and the the Credit Guarantee Scheme.The former, a government-backed initiative in partnership with local banks, provides N$500 million to SMEs for improved financial access, covering operational expenses like salaries and rent. Meanwhile, under the Credit Guarantee Scheme, the Namibia Special Risks Insurance Association (Nasria) offers 60% collateral cover after a successful assessment of an SMEs bankability and lack of collateral."One issue we have identified is SMEs looking to level up and take on bigger jobs, such as tenders, but lacking the capital to do so," Ikela explained. "Our contract financing solution has emerged as a viable option, providing businesses with funds against tender documents, purchase orders or project agreements."By focusing on the collective effort to support SMEs, Nedbank Namibia aims to be a trusted financial services partner, providing the support and confidence that businesses need to scale, innovate and maintain their vital role in the economy, he added.

Supporting SME sector's resurgence

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Republikein 2026-02-03

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Supporting SME sector's resurgence

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Republikein 2026-02-03

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