‘Financial literacy will reduce NPLs in SMEs’
FINANCIAL training and literacy are critical if the country is to reduce non-performing loans among small and medium enterprises as prospective businesspeople are taught to differentiate between business and personal finances, Homelink Finance Private Limited sales and channels manager Sibusisiwe Mashoko has said. Homelink Group owns Homelink Finance. It emerged most SMEs funding had been affected by repayment failure, a problem Homelink is going to address when it hosts a workshop in Gwanda next week. The five-day workshop in Gwanda that starts on March 19, 2018, will be convened under the banner Women Entrepreneurship Development Training and will be hosted under the theme “Entrepreneurship Mindset for Sustainable Development”.
Ms Mashoko told The Herald Business that the Central Bank subsidiary is going to train people on the handling of business funds to improve their well-being and their societies.
“We are going to teach people how to differentiate between business money and personal money. We don’t want people to take business money to throw some parties or other luxury aspects. That training is critical to ensure that financial inclusion is done for people to understand the impact of borrowing and running a business financed through a debt. It is critical so that we can reduce our non-performing loans.
“In terms of loan repayments, women pay better than men. Women are much organised in groups, they come together and pay together.
“On the other hand men don’t but this time we hope that these workshops will improve our people’s understanding of how to run a proper business no matter how small,” said Ms Mashoko.
She said failure to pay is usually caused by the current economic conditions, which force a family to use the business money to solve family problems. Homelink Group has opened a new branch in Gwanda in the last quarter of 2017 and found out that there was lack of uptake in the SMEs loans.
She said: “We have decided to take the mandate to capacitate the market that is surrounding that branch. We want to ensure that there is finance uptake in terms of economic activities and also for personal development.
“This training is supposed to capacitate participants and make sure that they are able to carry out future businesses through programmes that include business plan writing, business ethics, entrepreneur finance, accounting and entrepreneur mindset. This kind of training programme is happening for the second time and the first one was done in Harare in 2017.”
The company is also targeting the youths, women and for the first time is targeting 10 percent of the participants to be the disabled.
The company has been in partnership with the group in Bulawayo, which is run by five individuals who will be part of that training programme.
Homelink will be carrying out capacitive programmes, which include the leather value chain training that it wants to do for the community of Matabeleland that will be hosted in Bulawayo through the Leather Institute.
There will also be training of Chiefs in Matabeleland North.