The Development Bank of Namibia (DBN) has provided over N$1 billion in loans to 989 small and medium-sized enterprises (SMEs) since 2017.
According to DBN’s Chief Investment Officer Hellen Amupolo, these businesses have contributed to 35% of national employment, despite receiving just 20% of the available funding.
“Since 2017, DBN has advanced over N$1 billion in loans to 989 SMEs. This represents a significant portion of our financing efforts, with a particular focus on sectors that contribute to Namibia’s development,” she said at the Economic Association of Namibia (EAN) engagement focused on SME upliftment.
Amupolo added that DBN’s focus on supporting women, youth and previously disadvantaged individuals is also expanding, with a new gender-based financing product currently in the pilot phase.
“Although DBN has been in operation since 2004, our reporting and detailed focus on SME financing has only been crystallised in recent years, particularly since 2017. This is when we began to rely on robust, dependable data to measure our interventions more effectively,” she added.
This comes as to date, DBN has pumped over N$2 billion into the SME sector, with a substantial amount of that disbursed since 2017.
“These funds have enabled SMEs to grow, create jobs, and contribute to economic diversification. While we are proud of this achievement, we acknowledge that there is room for improvement in ensuring equitable access to this funding, particularly for underrepresented groups,” said Amupolo.
Furthermore, one area where DBN is focusing on improvement is gender equity in SME funding.
“Although we have financed a substantial amount of assets, the contribution of women-owned businesses to this total has been relatively small. We are addressing this by launching a gender-based financing product in partnership with the Ministry of Gender. Currently, in a pilot phase, this product aims to provide greater access to funding for women entrepreneurs,” she noted.
DBN is also a key player in implementing the Government’s SME Finance Strategy, which was approved by Cabinet in June 2018.
The strategy includes three main components, the Credit Guarantee Scheme, Mentoring and Coaching, and Venture Capital Fund.
The Credit Guarantee Scheme covers up to 60% of the principal loan amount for businesses that are bankable but lack collateral.
DBN has partnered with several commercial banks, including First National Bank, Standard Bank, Bank Windhoek and Nedbank. DBN is also now a participant in this scheme.
“This programme supports entrepreneurs with financial literacy, governance and human capital development. Launched in 2020, this initiative has reached over 130 mentees and has 13 active mentors. DBN is currently evaluating the programme’s impact,” said Amupolo on mentoring and coaching.
Meanwhile, the Venture Capital Fund provides long-term equity for SMEs to support their growth. While still being implemented, the trustees have been appointed, and DBN is moving forward with its rollout.
The EAN held an engaging public discussion titled “Bridging the Gap: Government Funding Solutions for Namibian Startups and SMEs” at the Hilton Hotel in Windhoek on Tuesday.
The event aimed to address critical funding challenges facing small and medium-sized enterprises (SMEs) and startups in Namibia, with an emphasis on practical government-driven solutions.
During the opening remarks, EAN Vice President Jesaya Hano-Oshike spoke on the importance of supporting SMEs.
“There is a pressing need to streamline and enhance support mechanisms for MSMEs. Simplifying public procurement processes, reducing interest rates on loans and fostering collaboration with commercial banks are critical steps towards creating a conducive environment for MSMEs to thrive,” he emphasised.
