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The Bank of Zambia (BoZ) Board has approved a K5 billion loan facility under the Small Business Growth Initiative (SBGI) to enhance access to finance for Small and Medium Enterprises (SMEs) across the country.
The initiative aims to support SMEs as a key driver of economic growth, in line with the government’s private sector-led development strategy.
BoZ Governor, Denny Kalyalya, made the announcement during a panel discussion at the Zambia Impact Investment Summit (ZIIS), held at Ciela Resort in Lusaka on Wednesday.
He revealed that the central bank was finalising the last few details to ensure the efficient and effective operation of the loan facility before its official unveiling.
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“The SBGI loan facility is designed to provide affordable financing to SMEs, and its interest rates will be determined by the Monetary Policy Rate (MPR). That is why the Bank is working tirelessly to bring the MPR down to more moderate levels,” Kalyalya explained.
He highlighted the critical role played by SMEs in Zambia’s economy, emphasizing that the government’s goal of sustained economic growth hinges on empowering the private sector, particularly small businesses.
However, Kalyalya pointed out that there were significant challenges in identifying bankable projects that can access such financing.
He urged development partners to step in and assist SMEs in developing projects that meet the criteria for accessing the loan facility.
Additionally, Kalyalya mentioned that the BoZ was collaborating with the Patents and Company Registration Agency (PACRA) to expand the range of acceptable collateral that SMEs can use when applying for the loan facility.
This effort aims to lower barriers for SMEs, enabling more businesses to qualify for financial support.
The Zambia Impact Investment Summit provides a platform for key stakeholders to discuss ways to attract investment into Zambia, with a particular focus on supporting SMEs and fostering inclusive economic growth.
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