Thursday, July 14, 2011

Access to capital a barrier to SME growth - Puma

Access to capital a barrier to SME growth - Puma
By Gift Chanda
Thu 14 July 2011, 14:00 CAT

COMMERCE deputy minister Lwipa Puma says access to capital has remained a significant barrier to the growth of the SME sector in Zambia. During the launch of the MPH Chartered Accountants, Dr Puma admitted that small scale-entrepreneurs (SMEs) were facing challenges in accessing finance.

He further said the lack of accountability, strategic direction and good governance practices by SMEs had also contributed to the sector’s slow growth.

Dr Puma said the government had resolved to promote partnership with other countries through platforms such as the African Growth and Opportunity Act (AGOA) as a way of cushioning the challenges.

“Access to capital is a significant barrier to the growth of the sector. However, the accountability, strategic direction and governance practices of the SMEs remain serious impediments to its development,” Dr Puma said.

He said the launch of MPH Charted Accountants, a firm specifically aimed at providing audits, accounting, tax and consultancy services to SMEs, was a key step towards the growth of the sector.

Dr Puma said the firm would provide SMEs a gateway to access institutional finance, mentorship, accountability to their stakeholders and an expansion of the tax base.

Earlier, MPH Charted Accountants managing partner Hastings Mtine said the firm would assist in improving accountability in the SMEs sector.

He said currently, there are concerns on SMEs’ contribution toward the treasury.
Mtine said the company would start its operations with two branches in Lusaka and Kitwe.

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