UNPD partners with FNBB to grow SMEs
The First National Bank Botswana (FNBB) recently signed an agreement with the United Nations Development Programme (UNDP) to support the growth of Small and Medium Enterprises (SMEs) in Botswana.
FNBB Chief Executive Officer (CEO), Steven Bogatsu described the partnership as ‘an outstanding asset’ designed to build innovative, productive and competitive SMEs to enable them to supply large companies effectively and efficiently.
“We are pleased to enter into this agreement with UNDP because as FNBB, we remain deeply invested in partnerships and collaborations that create lasting socio-economic impact,” he stated.
Bogatsu noted the agreement was perfectly timed, coming so soon after the Citizen Economic Inclusion bill was signed off by parliament. It is hoped the bill will create a market and demand for local products and services.
Through the partnership, Bogatsu revealed the bank will provide preferential and competitive services to suppliers, mostly SMEs, who are on the UNDP’s Supplier Development Programme (SDP).
“As an integrated financial services provider, FNBB will provide tailor-made solutions to the unique needs of these businesses,” he promised.
UNDP Resident Representative, Margunn Alshaikh pointed out the SDP is now in its second year of implementation, with ‘access to finance’ identified as a common challenge experienced by most SMEs on the programme.
“UNDP recognizes the difficulties faced by small businesses in their attempts to apply for various credit facilities through traditional banking means,” she said.
Alshaikh highlighted lack of collateral or security, poor business plans, low financial literacy and a lack of financial records as some of the key factors hindering SMEs ability to raise capital.
“As such, the UNDP-SDP approached the commercial banks and national financial institutions to provide access to holistic finance packages, tailored towards the needs of SMEs, that will provide investment and credit facilities at discounted rates,” she explained.
Alshaikh said UNDP saw fit to partner with FNBB in an effort to prioritize access to funding for the SMEs through the SDP.
“The UNDP-SDP provides training and support that cultivates growth within SMEs to a level where they can be considered bankable, meeting the requirements of commercial banks and national financial institutions, and in effect, reducing the level of risk often associated with SMEs.”
In turn, she revealed FNBB will provide the suppliers on the SDP with discounted lending rates, crafted within the framework of a full value banking solution to help them grow their businesses.