Two Banks Chalk Up Development Success

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By Surihe Gaomas WINDHOEK A partnership agreement signed in August last year, between Bank Windhoek and the Development Bank of Namibia (DBN), to aid Emerging Small and Medium Enterprises (ESME) country-wide appears to have started bearing fruits. These revelations were announced last week at a joint press conference to mark the first anniversary of the agreement between the two entities, exactly a year after the two parties put ink to paper. Testimony to that was a further extension of N$10 million dollars, from the original agreement amount of N$30 million. It was on August 23, 2005 that the DBN agreed to invest a total of N$30-million with Bank Windhoek over three years. However, in 13 months, Bank Windhoek has committed over N$23 million to small businesses. According to David Nuyoma, Chief Executive Officer of the DBN, at the onset of the joint venture his organisation estimated that N$10 million dollars would be needed for the first year of operations. However, he was happy at the pace of success the agreement has recorded. ” At the time, we estimated that N$10 million would be required in the partnership’s first year of existence. However, the extension of the third N$10 million tranche exactly a year later since its inception is indicative of the relevance of the facility and the responsiveness to the SME needs” said Nuyoma. The second N$10-million was provided around May this year. With the assistance of the DBN, Bank Windhoek was able to provide funding to 29 beneficiaries under this facility, creating jobs for 212 people. Through the partnership, the loans to ‘Emerging SME’s’ in the country were offered at affordable interest rates. Furthermore, Bank Windhoek’s ESME Branch is currently offering this service to more than 300 clients. Loans for this partnership range between N$250 000 and N$3-million. Through the principle of Public Private Partnership, both entities have proven that such an agreement works very well. Globally, close to 70 percent of SME’s fail. However, through the voluntary Bank Windhoek Mentorship programme selected groups of Emerging SME’s have already graduated via the programme. “This advancement of people and multiplication of resources represent the essence of capacity building,” added Nuyoma. Speaking at the same occasion, Managing Director of Bank Windhoek James Hill said although the ESME market is underdeveloped, it is fast gaining momentum. “The vision of our ESME branch is to see an increasing number of ESME’s grow into sustainable business, creating new wealth and new opportunities for the benefit of the Namibian economy,” said Hill. He added that it is not only by providing finance to entrepreneurs that guarantees successful business, but also the use of training them in business management skills and knowledge. So far, 13 ESME clients have completed the Bank Windhoek Mentorship Programme. Presently, there are 55 ESME clients benefiting from the mentorship in Oshana, Ohangwena, Omusati, Otjikoto and Khomas regions. However, due to the increasing numbers of such clients, the bank plans to extend this service to the Erongo Region as well. Both companies hope the agreement will be continued in the years to come. Towards the end of this month, an exhibition will be held for EMSE’s to showcase their success.

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