There is widespread research to indicate that most start-ups fold within five years of inception.
Indeed, though considered to have the potential to ease the country’s crippling unemployment levels as well as contribute to the economy, local Small and Medium Enterprises (SMEs) continue to stutter.
Speaking to Voice Money’s KABELO ADAMSON, First National Bank (FNB) Head of SME Development, Jenamiso Ratsebe narrates her bank’s tailor-made programmes that target small entrepreneurs.
Q. Kindly explain your role as Head of SME Development.
A. I look after the SME clients.
What I currently do is look after their portfolios to make sure we deliver key business solutions and at the same time offer superior client experience and contribute to sustainable growth of SME clientele.
I look after the Zero to 10 million clients in terms of turnover.
As FNB, we are saying to you that as an SME client, we recognise you and we want to begin this journey with you right from the very beginning, from the day you start dreaming of whatever business you want to venture into.
Q. What do you think can be done to improve the status of SMEs in Botswana?
A. My view is that Botswana government does quite a lot for SMEs, especially the young entrepreneurs of this country.
Where we come in as a bank is that we want to mentor these SMEs and coach them on sustainability.
The key thing is to have sustainable entrepreneurs such that whatever we do, we do it for their growth ultimately.
So, we as FNB want to take this journey together with SMEs and build their businesses through this mentorship that we encourage.
There is a perception that banks don’t necessarily finance start-ups or SMEs.
But the key point is, during our mentorship programme we teach them that the relationship with the bank starts with having a business account.
We encourage our customers to deposit money on a daily basis, such that by doing so, you are also making sure that you are taking care of your credit worthiness status.
Q. What other programmes do you have catering for SMEs?
A. We have an Insurance package catered for the SMEs.
Like I said, the key thing is to create sustainable businesses.
If an SME client is not insured, we have what we call an insurance solution for the SMEs called Mogwebi.
Most SMEs operate from warehouses or factory shops and most of the times they do not necessarily own these buildings but the equipment inside is owned by them.
So the questions is, what happens when this building is engulfed by fire because the owner of the building is insured but what happens to you as an SME renting that building?
So we are saying, with this insurance solution SMEs can cover their belongings such that there is sustainability.
We have Business All Risk Cover, which means you can cover yourself and your property wherever you are as well as Goods in Transit where we know most of our customers operate as they import most of their goods.
Q. Do you offer financing as well? If so, how does one qualify for credit at your bank?
A. When you have come with us for a very considerable period following an extensive period of mentorship and walking the journey with you, only then we can look into credit extension in order to grow your business.
When we look at financing you as an SME, we look at your track record with the bank.
This is where we speak of Purchase Order Financing, which as long as you bank with us we are able to extend that facility.
Q. Kindly take us through your journey as FNB Head of SME Development.
A. I started working for FNB in 2016 managing the Riverwalk branch for about two years at which point I started this new role.
Before that I had been with Standard Chartered Bank for about four years.
Before joining the banking industry I was in Insurance where I have experience working for both the broker and the insurer.
Insurance was my first job when I started working at AON Botswana as a trainee graduate.
For me I was always interested in knowing that side of the corner, which is why I went into Insurance at Old Mutual Botswana as a Portfolio Analyst.
At a later stage, I then went to work for Alexander Forbes as Business Manager, taking care of personal lines – SME clientele.
So this ‘SME passion’ started from way back when I was a bit younger.
Now I get to do what I really like, which is to see people succeeding in life.
It gives me joy to hear a client say, ‘If I wasn’t for you as my banker I wouldn’t be where I am today!’
Q. In your experience, what would you say is the main challenge faced by local SMEs?
A. My view is that the biggest one is lending.
Secondly, you will find that SMEs do have the passion for business, but managing their finances is a bit of a challenge.
You will have an SME who has struggled for quite some time.
The minute they score a big deal, and because they haven’t gone through a financial literacy programme, it then becomes a challenge and (they) kind of misuse funds and tend not to think ahead in terms of making sure that the business is sustainable.
They tend to use the funds on a short-term basis and not think about things like expansion.
Financial literacy is a big challenge in the SME space.
You have to be cognizant to the fact that an SME client behaves exactly like a retail client because these are individuals who are running their businesses.
Q. Away from the office, how do you spend your free time?
A. I’m married with three kids.
When I’m not at work I spend my time with my family.
On Sundays I attend church and get involved in activities.
I like travelling and reading; weekends are dedicated to my family.