Why Banks Should Make Business Loans Accessible To SMEs – Vincent Adeoba, CEO Transtura  

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CEO Tanstura Transport, Vincent Adeola

Commercial banks need to be more flexible for startups to scale fast in terms of loan accessibility. For instance, charging monthly interest of 4% on a loan is scary for business owners to risk because at the end of the year, such person will be paying accumulated 48% interest and this is not affordable to them’’


In a bid to improve small medium enterprise sector in Nigeria through financial knowledge for SME owners on business funding and accessing loans from commercial banks and attracting investors, PwC recently held a webinar for SMEs on funds sourcing for business startups

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Speaking as panelist on the discussion “Funding My SME’’ CEO Transtura Transport, Vincent Adeoba stressed the significance of funds raising and accessing for entrepreneurs saying that funding is an integral for businesses to thrive especially when such business is at the pioneering stage in setting up.

He added that intelligent fundraising for small and medium enterprises goes beyond ordinary monetary capital but also includes social capital, debt capital and equity capital to seek for funds.

According to him, social capital forms the most important capital to have as an SME owner and must be developed over time.

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Social capital refers to a set of people that are willing to support one’s business idea and contribute to the success of the startups through trust and reputation earned from social relationships and contacts.

Accessing debit capital to fund business, Vincent called for the need of commercial banks to be flexible in their interest charged on loans as conditions attached to loans are not making it accessible for business owners.

In his words, “Commercial banks need to be more flexible for startups to scale fast in terms of loan accessibility. For instance, charging monthly interest of 4% on a loan is scary for business owners to risk because at the end of the year, such person will be paying accumulated 48% interest and this is not affordable to them’’

He further advised SME owners on non-dilutive investment when sourcing for funds to run their businesses saying oftentimes, such investment plan on the long run tends to favor investors and put business owners at the receiving end.

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“Avoid non-dilutive equity investment unless it is below 5% of your shareholding. Sourcing non-dilutive Investment plan worth above 5% of the business value simply means such investor has acquired such percent as stakeholder and getting such dividend from the company’s profits as returns.’’

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