Thesis (MDF)--Stellenbosch University, 2014. / Small and medium enterprises are recognised around the world as very important to a country’s
economic wellbeing. In developing countries, small and medium-sized businesses are seen as
effective vehicles that can quickly deliver much needed economic development, increased
employment, wealth creation and, ultimately, reduction in the poverty levels. However, these
businesses fail to deliver the much-touted economic and social-welfare benefits. This failure is
attributed to the many challenges that small and medium enterprises face, among which is a critical
lack of access to bank financing. Credit-guarantee schemes in sub-Saharan Africa have over the past
decades become a preferred intervention to try and get more bank financing flowing to small and
medium enterprises. In 2009, the Government of Zambia implemented the National Credit Guarantee
Fund as its intervention measure to unlock constrained bank credit to the country’s small and medium
enterprises.
Experience with credit-guarantee schemes in sub-Saharan Africa, including Zambia, has been rather
disappointing. This study therefore aimed to review the Zambia National Credit Guarantee Fund with
respect to its operational design, implementation and usage, evaluating the extent to which the design
and implementation met international best practice. The study also sought to find out whether the
design of the scheme sufficiently considered the local context of small- and medium-enterprise
financing and whether it was attractive enough for the local commercial banks in Zambia.
Using an extensive literature review, survey questionnaires sent to all commercial banks registered
in Zambia as well as structured interviews of senior banking and government officials, the study
found that, despite the Zambian credit-guarantee scheme having proper and adequate design that
conformed to international best practice, it was unable to attract the needed participation of the local
commercial banks. We conclude that, while proper and adequate designs of credit-guarantee schemes
are important in the success of the schemes, this by itself will not attract the participation of
commercial banks in an economy like Zambia’s. We infer from the results of the study that certain
other interventions, such as the improvement of the financial- and business-management capabilities
of small- and medium-enterprise management, must be put in place before mechanisms such as welldesigned
credit-guarantee schemes can be expected to achieve their intended aim.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:sun/oai:scholar.sun.ac.za:10019.1/96170 |
| Date | 12 1900 |
| Creators | Libakeni, Mark M. |
| Contributors | Thomas, W. H., Stellenbosch University. Faculty of Economic and Management Sciences. Graduate School of Business. |
| Publisher | Stellenbosch : Stellenbosch University |
| Source Sets | South African National ETD Portal |
| Language | en_ZA |
| Detected Language | English |
| Type | Thesis |
| Format | xi, 89 p. |
| Rights | Stellenbosch University |
Page generated in 0.0072 seconds