how to access finance for your small business in nigeria by fayo williams

HOW TO ACCESS TO FINANCE TO GROW YOUR BUSINESS

By Fayo Williams (Mrs.)

ILO Certified SIYB Master Trainer and

EXECUTIVE DIRECTOR, RELY SUPPLY LTD.08034030366 [email protected]

with materials courtesy1How to Access Finance by Fayo Williams

Outline

How to Access Finance by Fayo Williams

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What does ACCESS TO FINANCE mean? Criteria for Business Growth Current situation with regards to accessing funds Before Borrowing How to access finance to grow your business My experience Summary and conclusion

What is ACCESS TO FINANCE?


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Access to finance refers to the possibility that individuals or enterprises can access financial services, including credit, deposits, payment, insurance, and other risk management services.

(http://en.wikipedia.org/wiki/Access_to_finance)

What are the criteria for Business Growth?

1. Increase in Sales?2. Increase in Profitability?3. Increase in Assets?4. Increase in visibility?5. Establishment of structure?6. More branches? More staff?7. Increase in production capacity/service excellence?8. Increased capacity for R & D/ New product

development?

4How to Access Finance by Fayo Williams

•Access to affordable finance is a general problem facing MSMEs globally;

•Problem is more pronounced with small business owners in Nigeria (42.1%Micro, 13.57% - Small & Medium owned by Women. 2010 National MSMECollaborative Survey - NMCS )

•84.6% MSME owners start-up capital is from personal savings (2010 NMCS);

•9.2% accessed loans (2010 NMCS)

•About 42% of women indicated finance as a major growth constraint(Enterprise Baseline Survey 2012 - EBS)

•Collateral is the biggest constraint to accessing loans (EBS 2012)



6 Have you tried the three major ways of increasing

revenue? Have you thought of diversifying eg. by offering a

service alongside your product? VVIP – Have you blocked avenues of leakage e.g

petty cash?Ensure you have sound plans on how to repay the facility!!!

Have you leveraged on technology?Contact : [email protected]


Financing is the use and manipulation of money.

Raising money is one aspect of financing.

If you don’t have enough money to fund your business,another option is the use of other people’s money (OPM).

There are two ways to raise OPM. Each affects a businessdifferently. Debt: The business borrows money and pays

it back over a set period of time at a set rate of interest.

Equity: The business gives up a percentage of ownershipfor money. 8How to Access Finance by Fayo Williams

• Scalable business (business with opportunities for growth)

• Novel (new) or not run-off the-mill business (new and/or unique businesses)

• Opportunity for financial return

• Good management, focus

• Realistic business concept and plan

• Technical superiority

• Low risk

• Control 9How to Access Finance by Fayo Williams

Where is the money to grow our businesses?

• Governmental Financial Institutions and Development Funds• Govt – sponsored Funds for Women• Other Commercial Banks• Microfinance Banks• Venture Capitalists/ Financiers• Partners and Customers

• Equipment leasing

• Grants-public eg. YouWIN! and private (social/non-profit)

** Non – cash Support


CBN to inaugurate N200bn MSME fund Thursday http://www.punchng.com/business/money/cbn-to-

inaugurate-n200bn-msme-fund-thursday/

August 13, 2013 by Ifeanyi Onuba Abuja


• Agricultural Credit Guarantee Scheme Fund (ACGSF)• N200 Billion Commercial Agriculture Credit Scheme

(CACS)• N200 Billion Small and Medium Enterprises Credit

Guarantee Scheme (SMECGS)• N200 Billion Restructuring and Refinancing Facility

(RRF)• Nigeria Incentive-based Risk Sharing System for

Agricultural Lending (NIRSAL)

www.cenbank.org/devfin/12How to Access Finance by Fayo Williams

• Have a clear business plan• Provide up-to-date records on the business

operation• Have no non-performing or delinquent loans with

any financial institution• Be a member of the Organized Private Sector

Bodies/Associations such as LCCI, the Manufacturers Association of Nigeria (MAN), State Chapters of NASME, NASSI etc.


To access the guidelines, paste the name of the scheme

into your browser window eg. Agricultural

Credit Guarantee Scheme Fund


• Rural Women Enterprise Development Programme (RUWEDEP)• Cluster Development Program (Lagos, Calabar, Agbaku-Eji, Aba,

Abakaliki, Alo-Borno, Kaduna, Osun, etc)• General Entrepreneurship Development Programme (GEDP)• Women Entrepreneurship Development Programme (WEDP)• Implementation of the National Policy on MSMEs• Specialized Entrepreneurship Training Programmes• National MSMEs On-line registration• Small business opportunities fairs

www.smedan.gov.ng15How to Access Finance by Fayo Williams

SMEDAN CONTACTS IN STATES


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SMEDAN, Lagos Zonal Office 107, Ogunlana drive, Surulere, Lagos Contact person: (Gbenga 080 3670 6209),

Grants: https://www.youwin.org.ng/

How to Access Finance by Fayo Williams 17

A YouWIN! Winner


Mrs. Susan Uko - Abasi

My experience with accessing finance to grow my business


Further Resources:Access to Finance Headaches of SMEs: Imagined or Real?

Article on www. http://nigeria.smetoolkit.org/


You can also visit my Blog: www.awesomebiztips.com

Summary and Conclusion


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Funds are available, from overdrafts to vehicles leases, non – collateralized loans and advances. However, SMEs deserve a better deal in terms of the interest rates, delay or lack of specificity in date of release and steep requirements.

When this is achieved, our nation will witness the much desired economic leap

‘Fayo Williams08034030366 (sms preferred)
