|Name of Applicant :||Empretec Business Forum (EBF)|
|Title of Action :||National dialogue on difficulties in accessing finance for development of SME's in Ghana|
|Geographical Area :||Greater Accra|
|Action ID :||# 0-5|
|Action Score :||66.5%|
|Total cost of Action :||¢400,991,400|
|BUSAC's % of Total cost :||90%|
|Self Financed :||10%|
|Action Duration :||18 months|
|Support from Outreach Facility :||¢-|
|Summary of the proposed Action :||(a). 1. NEED FOR THE ACTION
The problem evolves from the fact that over 92% of SMEís in the Private Sector in Ghana are denied funding or have very limited access to finance from the formal financial institutions. Indeed if such is the case or reality, then there is a need for an action. EBF is taking the initiative to undertake this action on behalf of its members and all SMEís.
The banks argue that SMEís are high risk business clients. The SMEís also claim the banks do not either understand their plight or do not have the patience to do so due to their strong desire for high margins on every transaction. The banks further accuse the SMEís of clumsiness in their business transactions as they do not keep proper and adequate records to enable effective assessment of their financial proposals. Financial Intermediaries now claim that the environment has improved considerably though not absolutely. But the SMEís say its only a facade, many enterprises in the rural and smaller towns still do not have easy access to credit to finance their businesses. The bankers lackadaisical manner of responding to reduction in the prime rates of interest is a case in point. The poor rate of savings mobilization by the formal banking system is another indicator of lack of confidence. A recent survey by Support Program for Enterprise Empowerment and Development (SPEED) on 15 banks in Accra, (Financing your Business August 2004), showed that there is a significant Gap. Therefore there is a need for an action to bridge the gap between the lenders and borrowers in the sector to break this barrier to accessing finance for the Development of SMEís.
(b). 2. PROPOSED SOLUTION TO THE NEED:
(c). 3. IMPLEMENTATION PLAN: