• October 22nd, 2019

Start-ups' money stuck in SME Bank…entrepreneurs despondent over saga

Front Page News
Front Page News

Edgar Brandt WINDHOEK - A concerned group of Small and Medium Enterprises (SMEs) who have seen their hard-earned money disappear before their very eyes due to liquidation of the SME Bank have approached the Namibia Chamber of Commerce and Industry (NCCI) for assistance and guidance. The SME Bank, which was placed under provisional liquidation last year following dubious investments of about N$200 million in South Africa, immediately halted all payments and withdrawals when the Bank of Namibia assumed control of it following the discovery of illegal activities. “It is a really depressing situation for SMEs to the extent that many of these SME owners have become so depressed and even suicidal because many of these owners are under the impression that they will never get their money back,” said NCCI’s acting CEO Charity Mwiya. During an exclusive interview with New Era, Mwiya noted that government bears the brunt of the responsibility, as it encouraged SMEs to make use of the SME Bank. “Some of the small businesses even deposited their money merely days before the closure of the bank,” Mwiya noted. She also called on SMEs affected by the SME Bank saga to register with the NCCI, for the business chamber to be able to assess the exact magnitude and extent to which the debacle has impacted businesses and lives of SME owners. The spokesperson of the concerned group of SMEs, Dr Daniel Nyaungwa, who is also the Rector of Monitronic Success College, reiterated Mwiya’s call for affected SME owners to come forward and register their complaints. In fact, Monitronic Success College was directly affected as it lost about N$1.2 million deposited into the SME Bank by the Namibia Students Financial Assistance Fund (NSFAF). According to Nyaungwa, his institution then had to source funds from its working capital budget to refund their students. This, in turn, left Monitronic struggling with operational capital, including a monthly salary bill of about N$500 000. “As the owner of the Bank, government should take full responsibility because the current liquidation process is disadvantaging us,” said Nyaungwa. When the SME Bank was placed under provisional liquidation, it had approximately 24 000 small depositors (those with less than N$25 000) and some 380 larger depositors (those with more than N$25 000 in the bank). Deposits at the defunct SME Bank were protected by law up to N$25 000 only.
New Era Reporter
2018-07-13 08:54:57 | 1 years ago

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