The Citizen Entrepreneurship Development Agency (CEDA) Chief Executive Officer, Thabo Thamane has dismissed sentiments that the agency is in competition with commercial banks to fund startup and enterprises. “CEDA is not a competitor to commercial banks, but a catalyst to de-risk those that would have not been assisted by banks,” said Thamane, during the launch of Africa-China Trade Solutions (ACTS) and TradeClub offerings by Stanbic Bank Botswana.
ACTS is a cross-border facility enabling local entrepreneurs and SMMEs a seamless connection to China for either imports or exports, mostly helping local enterprises connect with China-based suppliers and manufacturers, to make the import process simpler. Thamane further highlighted that most of the CEDA clients do not have sources to collateral needed by banks, hence CEDA cultivates the startups.
“And we are not apologetic about it,” said Thamane, highlighting that the Agency offers low interest rates so that the burden of the debt is not a contributory to enterprise defaulting. Commenting on ACTS, Thamane welcomes the initiative citing that CEDA’s experience with cross-border transaction has not been pleasing, as their clients are either swindled or receive inferior products from China and other countries, a development that leads to a rise in CEDA’s defaulters.
Apart from being swindled and receiving inferior products, Thamane highlighted that local enterprises have cash-flow challenges due to delayed payments. “Government and other business, let us pay business on time, there is absolutely no reason for the 90 days policy, cash-flow is key,” said Thamane, adding that SMMEs are meaningfully contributing to the country’s gross domestic product (GDP). He said delayed payments to SMMEs should attract interest.
Thamane further implored stakeholders in the business community to forge new partnership to help startup business in the local ecosystem. Meanwhile, Stanbic Bank Botswana’s TradeClub is a digital platform that offers the banks clients access to other markets and is a free service for the bank’s existing current account holders.
The TradeClub also assists local importers with access, assessments, and communication with suppliers and vendors, and manages the process of importing quality goods and services efficiently and safely. In addition, it allows vetted clients to be listed as exporters and be able to connect with potential customers across more than 45 jurisdictions worldwide.
“We are proud to have a strategic partnership in place with the world’s largest bank, Industrial and Commercial Bank of China (ICBC), which gives us unrivalled competitive advantage for Africa-China trade.
With experience in regulations and numerous Africa growth sectors, as well as strong partnerships with African government and businesses, Stanbic Bank Botswana is perfectly positioned to link our businesses to growth opportunities in the African and Chinese economies,” said Akofang Kebonye, Stanbic Bank Botswana Head of Trade and Africa China Banking.
He said TradeClub facilitate capital flow and cross-border trade between Africa and China with great proficiency, by virtue of ICBC’s financial and global reach and Standard Bank Group’s deep expertise and heritage in Africa. Kebonye said the solutions are intended to compliment Botswana’s leap into the fourth industrial revolution (4IR) by enabling rapid industrialization to establish manufacturing capacity as well as facilitating digitalisation on trade.
Currently, Stanbic Bank facilitates access to markets in Africa and the rest of the world and with the advent of the Africa Continental Free Trade Agreement, intra-Africa Trade offers incredible opportunities for Small, Micro and Medium Enterprises (SMMEs) to access new markets and grow.