Small and Medium Enterprises (SMEs) have complained about high interest rates whenever they receive loans to improve their businesses. This was revealed during the final discussion to solicit opinions and generate valuable input on the draft Micro Credit Scheme Operational Manual on Government’s 100 million Euro support to the SME sector.
According to the CEO of the Small and Medium Enterprises Development Agency (SMEDA), Siaka Sannoh, the package will provide financial inclusion for SMEs, adding “these small and startup businesses have attributed the high interest rate and collateral among other things as impediment for their business survival”.
Economists say the global COVID-19 pandemic has further thwarted gains made by small businesses the world over, not only in Sierra Leone, and advised for urgent measures to cushion its impact. The consultative forum, which brought together sector stakeholders from the Western Area, was the final stage of ushering the implementation of the microcredit scheme.
According to Minister of Tourism and Culture Memunatu Pratt, the tourism industry has been negatively affected by the pandemic “in the few months so far,” adding that SMEs have suffered its ripple effect. She, however, praised this move by the Government to improve the lot of SMEs considering the losses they have suffered during this period. “It is a timely move by the government and the agency,” the Minister stressed.
Participants also applauded the Government and SMEDA for setting up the fund in support of the sector. One of them quipped that the interest rate for such monies has been a problem for SMEs in Sierra Leone. The Sierra Leone Small and Medium Enterprises Development Agency is a government entity established under the SMEDA Act No.11 of 2016 for coordinating SMEs activities in Sierra Leone.
By Mohamed J. Bah