Ecobank Ghana and Eximguaranty Company on Wednesday organised a joint seminar for selected Small and Medium Enterprises (SME) business leaders to upgrade their practical financial skills and improve their relationship management with financial institutions.
The seminar on the theme: "The Role of Financial Institutions in the Development of SMEs", will enable participants to explore innovative ways to effective financial management so as to enhance access to financial resources for their operations.
Speaking at the opening session, Mrs Felicity Acquah, Managing Director Eximguaranty Company, said SMEs constituted a major pillar of inclusive economic development in any country, however, access to finance had been a major impediment to their growth.
She said while in most cases the banks did not understand SMEs, especially in the areas of their structures and entrepreneurial skills, "SMEs did not also understand the procedural requirements needed by the financial institutions".
Mrs Acquah said it was important that SMEs understood the procedural requirements of the banks to be able to get the necessary financial resources to support their operations for growth and to maximize profit.
Mr George Mensah-Asante, Executive Director of Domestic Banking, Ecobank Ghana said the country's economic growth, foreign exchange earnings and generation of employment for the youth depended on the successes of SMEs operations.
He said it was necessary therefore to improve access to sufficient and adequate capital for SMEs to foster entrepreneurship, competition, innovation and growth in the economy.
However, Mr Mensah-Asante said most financial institutions continued to shy away from SMEs financing because of adhoc business planning, poor record keeping and character and integrity as well as inability to provide collateral.
Mr Mensah-Asante said the seminar was to provide the platform to work through some of the challenges and to ensure that SMEs operations were streamlined to make them attractive to banks and other financial institutions.
Mr Joe Tackie, Coordinator Private Sector Development II, Ministry of Trade and Industry, said government was strengthening institutional framework to ensure that financial innovation work better for SMEs.
He urged the banks to engage more with the critical mass of developed and potential SMEs as demand side of finance was critical to the success of entrepreneurs.
Mr Abdulai Abdul-Rahman, Head SME Banking Ecobank, urged SMEs to ensure constant information flow, keep proper records of transactions and honour their financial obligations timely so as to maintain the trust and confidence of financial institutions.