South African banks are permanently between a rock and a hard place in the context of SME's.
On the one hand government expects them, as public companies to provide development capital, which is not their role, and on the other hand, the government has created the expectation that banks will / should finance all SME's.
Government on the other hand manages all it's development finance as though they were running a bank, using duplicate systems to the banks in deciding who to give loans to. So government does not do development capital properly, and banks do not do it but are expected to.
However, while South African banks are undoubtedly innovative in many ways, and world leaders in certain respects, they are decidedly lacking in innovation when assessing SME loan applications. However, I do not believe they are any worse than other banks elsewhere in the world. However, they could possibly all learn a thing or two from banks like Grameen and ICICI perhaps.
Rob Smorfitt
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Rob Smorfitt
(Visit Rob's Website)
Based in Pietermaritzburg, South Africa.
Married with 3 children (22, 21 and 14).
Have an MBA and am currently doing a PhD
in entrepreneurial success. I have been
self employed since 1982. I have started
26 and bought 5 businesses since then.
Most were sold again and a few were shut
down because of a lack of profitability.
Many were run by staff or family while I
worked in full time employment in my
bigger businesses. 6 books written in SME
and Project Management educational field.
Written articles for various magazines,
newspapers and websites.
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