Economists universally acknowledge SMEs role in lifting a nation's economy. The SME sector expands industrial development, increases job opportunity, and builds local communities. Despite SMEs vital role in economic development, they’re restrained by lack of financial resources. The International Finance Corporation (IFC) estimates SMEs are underfunded by approximately 2 trillion dollars, with women led corporations most affected by deficient funding.
Support Small and Medium-Sixed Enterprises (SMEs) for Economic Growth
Near all cultures value the ability for members to save and borrow capital. Means of saving money is essential to preparing for emergency situations and making larger purchases like educational investments and vehicles. Those without reserved funds often turn to loans to cover unanticipated expenses. Unbanked people, living their lives isolated from financial services, have trouble saving and borrowing capital, placing them at increased risk in the event of misfortune. Financial inclusion is necessary to eliminate economic inequality, but it is not the final destination as many presume. Economic inclusion is the end; financial inclusion is merely the means of arrival.
The production of economically priced smart phones has transformed the way Africans communicate with one another and conduct business. There are over half a billion mobile subscribers throughout the continent—a figure expected to break 725 million by 2020. Affordable smart phones have facilitated the entrepreneurial spirit and contributed to a variety of businesses little before seen throughout the nation. The increasing connectivity mobile devices offer have prompted a series of health, agriculture, utility, and educational digital services.
Millions of Africans face difficulties accessing financial institutions that enable citizens to securely handle their funds. Access to such facilities allow citizens to store and secure their money without fear of theft or mismanagement, establish savings accounts to protect against economic recession, and enjoy valuable interest-generating bank programs. Segments of the population privileged enough to enjoy financial services face long travel times and large transactional fees. The means through which they’re able to transfer money to distant family and friends are often unsecured and vulnerable to mishandling. Mobile wallets help level the economic playing field by reducing financial inequality. This new technology, accessible to a massive proportion of Africa’s population, enables residents to improve their livelihoods.
When the logistics of manual recordkeeping, counting totals, and the vulnerable security of cash storage are taken into account, cash payments are more expensive and inconvenient than digitalized payments. Digital payments, stored and handled technologically, are less susceptible to conventional theft, allowing both senders and receivers peace of mind. With mobile payments, disputes over transactional amounts are obsolete since all activity is electronically logged and recorded for honest review. For the unbanked segments of the population, mobile checking accounts pave the way to formal banking by functioning as a safe and simple introduction to conventional financial services. Consumers may also use their mobile wallets as informal savings accounts and build significant financial reserves for larger purchases or use during difficult times. Digital payments are more than convenient; they’re life-changing for those living beyond the realm of private banking.
