GroFin assures SMEs of easy access to financing

Mr. Samuel Sedagah, Country Manager of GroFin, a business loans company, has assured Small and Medium Enterprises (SMEs) in the country of the company’s commitment to supporting them to boost wealth creation and increase employment.

In an interview with the B&FT, Mr. Sedagh said: “SMEs must disabuse their minds that access to finance is a limitation to their business and can rely on GroFin to invest in their businesses.”

He was speaking on the sidelines of a day’s workshop which brought together financial sector players, SME operators, business executives and entrepreneurs, aimed at exposing GroFin to partners about its broad based operational strategies of assisting SMEs with easy access to unlimited funds for business expansion.

Mr. Sedagah emphasised that GroFin, which was established in 2004 with the sole aim of developing and managing SME funds, currently manages 10 SME funds with total capital commitments in excess of US$500 million.

He also said GroFin is being supported by more than 30 leading international investors, adding that the company’s target is to assist committed entrepreneurs to access tailored finance and experienced business support.

Since the inception of GroFin, Mr. Sedagah explained, it has approved over 750 transactions, sustained 95,125 total number of jobs and 480,000 total family members impacted by investees, as well as sustained 28,500, representing 30% female jobs and added US$700 million economic value.

“We ensure that the businesses have a measurable impact and that SMEs that provide indirect job opportunities like training, skills development and or environmental services such as water, waste, energy, ecotourism are also attractive to GroFin.

Our minimum financing is US$100,000, cedi equivalent and maximum is US$1.5million…, repayments are normally in local currency except where the client wants the currency in dollars,” he said.

Mr. Raymond Denteh, GroFin’s Senior Investment Manager, added that the SME sector holds the key to accelerated development and must not be underestimated.

“As many as 70-90% of all SMEs fail in their first three years of existence and their success is dependent on access to finance, business skills and the enabling environment for growth,” he said.

GroFin’s pre-investment business support data of over 8,000 entrepreneurs shows that 72% have no formal accounting system, 43% are not compliant with local regulations, 66% lack environmental, safety and governance standards, 57% have no formal business plan, 63% of capital at risk.

“And these are all being recorded in a difficult SME enabling environment, Mr. Denteh stated.

He added: “GroFin delivers business support to clients prior to the investment and during investment period, focusing on improving business viability, sustainability and growth.

For this reason, entrepreneurs need to be receptive to receiving advice and implementing recommendations, normally around improving formalisation of their business.”