FINCORP BEGINS GUARANTEE LENDING SCHEME

MBABANE – FINCORP has begun lending operations under the Small-Scale Enterprise Loan Guarantee Scheme (SSELGS) with the Central Bank of Eswatini (CBE).

This latest move means qualifying small and medium enterprises (SMEs) can now access much larger loans worth up to E1 million from the Eswatini Development Finance Corporation (FINCORP) via the CBE SSELGS and repay them over a longer period of five years. The SSEGLS was established in the early 1990s by the Government of Eswatini under the Ministry of Commerce, Industry and Trade, and was placed at the Central Bank for administrative purposes together with the Export Credit Guarantee Scheme (ECGS). It is used to cover the lack of adequate collateral to cover risks associated with Small and Medium -sized Enterprises (SMEs) business loans. FINCORP is one of the SSELGS participating lending institutions that have recently been endorsed by the Central Bank.

FINCORP has announced that it will roll out SSELGS loans under a new product called ‘Sisekelo’ which has been added to the already existing FINCORP SME loan products that include; working capital, agriculture, order finance, asset lease finance, line of credit, long-term contract finance, and business acquisition on Title Deed Land. FINCORP Group Managing Director Dumisani Msibi emphasised that the ‘Sisekelo’ (SSELGS) loan product would be considered only for SMEs who present viable projects, but have a shortage or lack of other acceptable collateral for credit.”  It must be emphasised that a guarantee scheme does not in any way make non-viable business proposal viable.

Cover

“The guarantee shall cover justified credit facilities up to a maximum of E1 million to any single borrower and could be in the form of working capital, lease finance, order finance, and line credit,” he said. The repayment frequency for the ‘Sisekelo’ (SSELGS) loan product could be monthly, quarterly, bi-annual, or annually depending on the pattern of the borrowing business’ cashflow. Msibi said in line with FINCORP’s mantra, ‘helping you to help yourself,’ they were ecstatic to be part of the participating lending institutions authorised by the Central Bank for the SSELGS and they were looking forward to ‘help more start-ups and SMEs to help themselves under the scheme.’ “We believe that this new product (Sisekelo) will play an important role in small business, recovery in the months ahead. It is clear from the challenges that we are currently facing that recovery will not be as smooth or quick as first thought, which is why it is essential that we ensure the roll out of creative solutions that offer small businesses, in particular, different ways to play their part in helping our economy get back on its feet,” said Msibi.

Deepen

FINCORP further believes that this new development will deepen general financial inclusion efforts and its founding mandate to ‘empower emaSwati through the provision of meaningful access to credit, job creation, and poverty alleviation. Last but not least, we wish to express our profound appreciation to the Central Bank of Eswatini and Government as owners of the Credit Guarantee Scheme for opening it up to other non-bank financial institutions which will effectively increase access. The onus is now on SMEs across the country to not only receive loans but also honour their obligations once they have been funded if the scheme is to remain available well into the future.”

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