Entrepreneurs seek new funding model for African SMEs

The All Africa Association for Small and Medium Enterprises (AAASME) has called for the introduction of an alternative finance model to enable 80 million small and medium enterprises (SMEs) to access finance in Africa.

Ebiekure Jasper Eradiri, secretary-general of AAASME, said the Afrocentric Alternative Finance Model for SMEs has the capacity to uplift small businesses within the continent by improving their access to finance.

Eradiri stated this at a stakeholder meeting on the African SME development platform held at the African Union Secretariat in Addis Ababa, Ethiopia.

In a statement signed by Eradiri and made available to BusinessDay in Yenagoa, he lauded the efforts of the African Union Economic Affairs, Trade, Tourism, Industry and Mines for the growth of SMEs in the continent. He said the AU is poised at leveraging its convening power to engage member states, RECs and critical stakeholders in re-examining how to strengthen SMEs.

According to him, the AU move would also reinvigorate SMEs to achieve set goals as well as support the creation of an enabling environment for the development of SMEs.

Eradiri added that it formed part of AAASME strategies for the implementation of a plan of action for Accelerated Industrial Development of Africa and develop the Africa SME Development Program partnership platform.

Read also: DBN advocates policies to encourage MSMEs development

This would be achievable through a participatory approach by a continent-wide multi-stakeholder perspective that adheres to the Paris Declaration on Aid Effectiveness and Accra Agenda for Action.

He stated that financial institutions needed to wear the shoes of African SMEs to understand and serve them better than operating colonial banking templates designed for the western world.

Eradiri stressed that African SMEs deserved a new finance recipe that would resonate with the peculiarities of the African people.

Responding, the African Union chair on Economic Affairs, Trade, Tourism, Industry and Mines (AUC-ETTIM), Ron Osman Omar, assured that considerations for the AASME position and the necessity for a standardised definition of SME/MSME in Africa would be broadened.

Omar informed the stakeholders of the upcoming maiden AU SME Annual forum scheduled for Cairo, Egypt from June 27 to July 1, 2022, with African Business Council and AAASME as co-organisers of the event.