Industrialisation Cabinet Secretary Adan Mohamed says SMEs should look into partnering with private investors or seeking help from private equity firm who put money into a business for a particular period of time.
He was speaking in during the Kisii Entrepreneurship Summit where matters of support of the youth took centre stage.
“People who have great ideas, will always find solutions. There are a lot of private capital outside of the commercial banks that don’t charge interest. They are able to take a share of your business without charging you interest and that is what is increasingly becoming the most relevant form of financing,” Mohamed challenged.
Optimistic that the banks will eventually bring down interest rates, Mohamed says that SMEs should not be ‘held hostage’ waiting for this, arguing that banks are also in business with various demands from stakeholders.
“As a government through Central Bank we are working on modalities to it that everyone can access credit without stress,” he said.
Industrialist Dr Chris Kirubi who was among the chief guests called on banks to come up with new products that target SMEs and avert from demanding loan securities from small business.
“Financing is a big problem in this country. All these bankers talk very nicely that they will give you money. But when you go to the bank they forget they were addressing the youth. They start asking you ‘ how many cows to you have, have you got land for security.’ When you ask a poor man for security, and he is trying to start a business, he can only give himself or his wife as security,” Kirubi challenged the banks.
His triumph as an entrepreneur he says, was just because one bank, Barclays Bank, trusted him and gave him loans to purchase some of his key assets he owns now.
Kisii Governor James Ongwae urged investors to focus counties adding that a lot of opportunities lie there and not Nairobi alone.
The objective of the summit is to provide a platform to showcase to local, regional and international investors opportunities within the county.
The summit, taking place at Kisii University grounds brings together local, regional and international investors allowing for an exchange of innovative ideas that will ultimately lead to increased investments in the County.