Reports Leo Odera Omolo

THE high business mortality rates amongst small-and- medium enterprises (SMEs) could be checked if individual entrepreneurs pooled savings and investments, Juma Kisaame, the dfcu Bank managing director, has advised.

Kisaame and Kjell endorse the new $10m credit facility agreement in Kampala last week

Kisaame, an expert on SME financing, said many of the problems that plague SMEs could be addressed by what he called the “economies of association.”

“When you come together, you do not only pool funds, but you also pool skills, competencies and talents, which give the group advantages such as access to credit, discounts, better supplier terms and better interest rates,” he said.

He noted that working as a group enhances accountability and governance, which are key to the survival of businesses.

Kisaame was speaking last week at the signing of a $10m (about sh22b) credit line between dfcu Bank and the Norwegian Investment Fund for Developing Countries (NORFUND).

The eight-year facility is aimed at strengthening the bank’s ability to fund long-term projects like commercial mortgages, home loans, leases and SME loans.

It brings to $16m the total credit extended to the bank by NORFUND.

Roland Kjell, the NORFUND managing director, said the funding allows dfcu to make the much-needed intervention in supporting SMEs with affordable access to medium to long-term credit.

“Supporting entrepreneurial individuals or entities to create sustainable business, translates into ripple effects such as savings mobilisation, job-creation and value-addition, which is the only way of stimulating business growth and sustainable development,” he said.

Kisaame said SMEs presented an incredible growth opportunity for the bank.

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