A letter to the Bank, from SME owners

I know you use statistics that claim that up to 90 per cent of small businesses fail; did you take time out of your busy, risk-free schedule to examine how many failed because they lacked that access to credit? PHOTO | FILE

What you need to know:

  • I’ve seen a few of you trying, but there’s still work to do. Our predecessors – blue chips and large enterprises – all started as SMEs. Have you decided you don’t want to play a part in our growth?
  • From one client to hundreds every year. And thousands like me exist. I am still considered risky. Can’t you see my value has and will continue to appreciate faster than any security I could offer you? What does an SME have to do to prove him or herself?
  • I know you use statistics that claim that up to 90 per cent of small businesses fail; did you take time out of your busy, risk-free schedule to examine how many failed because they lacked that access to credit?

Dear Bank, 

My name is Small to Medium Enterprise. You may have heard of me – probably by my nickname, SME. I was born five years ago. Today I am annoyed and frustrated. The reason is this interest rate cap debate, and the tantrums that financial institutions are throwing over it.

I am not an expert on economics affairs, neither am I defending a position. My anger involves more than just what is happening right now, and the current discussions are opening up old wounds.

From time immemorial, you and your colleagues have denied me and my namesakes the credit we need to grow our businesses. The credit you should give us comes from citizens who deposit their savings with you, and who would benefit from our collective economic potential. If you gave more of us SMEs access to funds, the economy would do better, and people would have more money in their pockets and to deposit with you. We SMEs do not understand what can possibly be so complicated about that.

Whether the interest rates are 21 per cent or 14 per cent, your policy/belief about us has not changed. You think we are risky.

Let us tell you about risk: We collectively employ most workers in this country. Because of that, many Kenyans can fend for their families. We also provide consumers of goods and services – including yours.

SHORT-TERM VISION

We watch you retrench staff without batting an eyelid while we, in the same economic space and with much less resource, do our best to keep people employed. It baffles me that we are considered that risky.

I know you use statistics that claim that up to 90 per cent of small businesses fail; did you take time out of your busy, risk-free schedule to examine how many failed because they lacked that access to credit?

And so it is that one of the biggest financial risks for this country is the fact that you don’t want to take risks.

I’ve seen a few of you trying, but there’s still work to do. Our predecessors – blue chips and large enterprises – all started as SMEs. Have you decided you don’t want to play a part in our growth? What should we do to you when we make it big and you suddenly come back to us, begging for business?

Innovation and creative thinking is not a choice for me. My parents told me that I have to be a visionary, think big, and looked beyond current resources every day. This is what I have done. Without your help, I have grown out of my bedroom into an office space. I now have eight full time employees and another 10 part time.

From one client to hundreds every year. And thousands like me exist. I am still considered risky. Can’t you see my value has and will continue to appreciate faster than any security I could offer you? What does an SME have to do to prove him or herself?

Bank, you have ignored one of the productive sectors of the economy: SMEs. You have chosen to direct credit to consumption, which has very short-term economic value, instead of directing it to those that have long-term value not just to you and your shareholders, but to the economy too.

I do not think an opportunity can exist forever. Someone will see the gap and create a solution.

I pray that you or somebody else grabs this opportunity. Inaction on your part can delay it but it will not stop it. Get me now. Don’t look for me when I am fully grown.