Absa Bank Ghana has reiterated the need to increase investment in for startups, particularly fintechs operating in the Small and Medium Enterprises (SME) sector.
The bank is targeting about 5,000 SMEs in the next 5 years to build their capacity to make them global giants.
This is expected to create about 50,000 jobs within the period, creating an avenue for entrepreneurs to expand their operations across the country.
Head of SME at Absa Bank Ghana Limited, Audrey Abaka told the B&FT in an interview that the bank will work with a business development support consultant to mentor and coach the startups.
She stated that most startups need support to restructure their operations to make them competitive.
“In most cases sometimes what we think the SMEs need immediately is funding. But beyond that they need something more than funding. One of the key things they need is the support to be able to structure their business in a manner that support growth,” she said at the sidelines of the Accra Spintex Startup Summit.
Madam Abaka explained that post Covid-19 era provides an opportunity to increase investment in startups in the fintech ecosystem.
This, she said will help grow innovative ideas that will help design local solutions to solve challenges that may arise in the future.
She stressed that there is the need to guide startups to avoid pitfalls that may discourage entrepreneurs from growing their business.
Madam Abaka mentioned for example that starting a business with a loan from a bank (debt) may not be an ideal move since servicing such a facility could be discouraging to young business owners.
She recommended that startups begin their businesses on a small scale and stabilize their operations before going for loans to inject into their business.
“When you start your business, to be honest you don’t need debt funding. Debt funding will put a lot of stress on you,” she said.
She announced that Absa has continuously made it easy for startups to enroll on most of the products designed by the bank to encourage and gradually build young entrepreneurs.
