‘Sharing info crucial to SMME financing’

2008-12-23 00:00

Effective information sharing is crucial in efforts to ensure access to finance for South Africa’s small, micro and medium enterprises (SMMEs), a research report commissioned by the National Credit Regulator (NCR), titled “Information Sharing and SMME Financing in South Africa” has found.

According to the report, acceptance rates for granting loans significantly improve when the financiers have access to suitable information about payment behaviour of small businesses. The default assumption is that insufficient information equals high credit risk.

Gabriel Davel, CEO of the NCR, commented that the establishment of a national register of credit agreements will improve the quantity and quality of information.

The report, put together by the Centre for Competitive Credit at the Political & Economic Research Council (PERC), found that the national credit register would be an ideal tool to promote information sharing of SMME data.

The risk faced by financiers of collateral being pledged more than once to different financiers could be mitigated by having a register of collaterals.

The report also found that by World Bank standards, South Africa has a remarkable level of SMME activity compared with similar economies.

The report says information solutions can help bridge the divide between the formal and informal economies by putting much-needed data in the hands of credit providers.

It found that SMMEs play an important role in the health of a country’s economic growth. A copy of the research report can be obtained from www.ncr.org.za/


— Witness Reporter.

Join the conversation!

24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.