By Arinze Okafor CFA,CAIA
The debate on access to finance in Namibia has resurfaced with intensity, following recent commentary by Roman Grynberg. It is a sensitive subject and rightly so because it reflects lived experiences across the SME landscape.
But if we are serious about moving forward, we must engage this issue with honesty, balance, and shared accountability.
Let us begin with a reality we often ignore as commercial banks are not designed to take developmental risk. Their core mandate is to protect depositor funds. Every loan advanced is backed by someone’s savings, salary, or pension.
Expecting banks to behave like venture capitalists is not only unrealistic, it is dangerous, and yet, Namibia is not a textbook economy.
We are a country shaped by historical inequality, uneven access to capital, and a growing base of entrepreneurs without inherited assets, formal track records, or deep financial buffers. This context matters. It means that while banking principles may be sound, their outcomes are not always developmentally aligned.
Government, to its credit, has recognised this gap. Instruments such as the envisaged national venture capital fund, national youth fund and the credit guarantee schemes, covering up to 60% of collateral are material interventions.
This is not symbolic; it is a real attempt to unlock lending. However, this is where the conversation and our thinking must mature.
Beyond collateral and financial ratios, we must begin to place greater emphasis on the “jockey” the entrepreneur behind the business. Discipline, execution, integrity, and resilience are not soft considerations; they are central to credit outcomes.
If we are to unlock capital meaningfully across all providers of capital, we must evolve how we assess risk and not just through balance sheets and excel models, but through people.
In that same vein, balance demands that we also confront an uncomfortable truth as there is, in parts of the SME ecosystem, a perception that government-linked funding does not always need to be repaid.
Whether fair or not, this perception increases risk aversion across the system and often places credible entrepreneurs in the same “unbankable” category. If we want greater access to capital, we must also build a culture of accountability as funding is not entitlement—it is responsibility. And this mindset is not innate; it must be taught, embedded, and reinforced through deliberate programmes and financial education.
However, we must be brutally honest about the structural realities facing SMEs. The statistic that up to 90% of small businesses fail within their first three to five years is often repeated, but rarely unpacked properly. In Namibia, many SMEs operate within seasonal cash flow cycles, particularly in agriculture, tourism, and informal trade. Financial records are often limited and asset bases remain thin, not necessarily due to poor intent, but because many businesses are still operating within a transitioning economy.
This is precisely where development finance institutions such as the Development Bank of Namibia, Environmental Investment Fund of Namibia, and Agribank must play a more decisive role.
Their mandate is not identical to that of commercial banks. They exist to absorb higher levels of risk in pursuit of developmental outcomes. Yet, in practice, many DFIs gravitate toward contract-based financing, where cash flows seem predictable and risks are easier to quantify. While understandable, this approach leaves a critical gap.
Consider a poultry or piggery business where demand structurally exceeds supply. The opportunity is clear. Yet funding is often withheld due to the absence of formal offtake agreements. The paradox is obvious: how does a new business secure an offtaker or get a track record without first being funded?
At a system level, the issue is not the absence of capital. Namibia is not short of liquidity. Institutional capital from pension funds to banks is significant. The challenge is the type of capital available and the way we assess projects. Our system is overwhelmingly structured around debt, which requires predictable cash flows and immediate repayment capacity.
Yet if most SMEs fail within their early years, then surely we must ask whether we are prescribing the wrong medicine for the problem. At times, it feels as though we are giving entrepreneurs Panado for a condition that requires open heart surgery. Debt has its place, but debt alone cannot solve early-stage business risk. Startups require patient equity capital.
This is why initiatives such as the National Youth Fund represent a once-in-a-generation opportunity for the youth. However, for the fund to achieve meaningful developmental impact at scale, continuous improvements in application support, assessment efficiency, and turnaround times will be critical. A funding structure anchored around approximately 4% per annum is not just financial support, it is empowerment at scale. But capital alone will not solve the problem as we must invest equally in mindset, capability, entrepreneurial orientation and link this startup funding to the broader follow-on funding ecosystem.
But equally important and often overlooked is the need to back seasoned jockeys who mostly fall in the upper youth and senior categories. In many cases, businesses fail not because of poor execution, but because of cyclical economic pressures and structural constraints. Failure, in this context, should not always be viewed as disqualification, but as experience.
Entrepreneurs who have navigated failure often possess a deeper understanding of risk, resilience, and cash flow dynamics which are qualities that are critical in Namibia’s competitive and unforgiving business environment. If we do not recognise this, we risk excluding exactly the type of entrepreneurs who are best equipped to build sustainable businesses.
Banks must intentionally innovate within their frameworks particularly through guarantees, blended finance structures, and alternative data scoring to expand access responsibly. DFIs must lean more decisively into their developmental mandate, even when it requires building internal capacity to assess non-traditional or contract based business models. Entrepreneurs must embrace accountability, strengthen repayment discipline, and invest in financial literacy. Policymakers must ensure that interventions such as guarantees and youth funds are implemented with rigour, transparency, and measurable outcomes.
Development must be funded through a layered system of capital, where each player funds a different level of risk across the economy. Let me be clear, and unapologetic: If we continue to fund only certainty and what we know, we will never build the very economy we keep saying we all want, as Namibia is our home and only we can drive her growth.
