Diamond Bank Plc has said it will continue to empower SMEs through capacity building so as to enhance their businesses.
The Credit Analyst at Diamond Bank, Mr. Cyprian Ofodum, said this yesterday while speaking at a workshop in Lagos, where an array of business owners from sectors such as service, manufacturing, trade and agriculture where taught on financial management and business development skills.
Ofodum, while responding to why Diamond Banks has continued to empower start-ups, said: “There are a lot of associated risks inherent with financing start-ups here in Nigeria.
“Survey has shown that most SME businesses fail within their first five years of operations because of poor management and control, lack of experience, poor planning and coordination, and the learning curve factor associated with entering into a new business.
“This is simply to say that businesses make mistakes and learn from their mistakes when they are starting up which is attributed to lack of experience. This has cost implications on the business and impacts on profitability.
“Another major factor is that for start- ups, they are still battling with competition and market acceptability which shrinks their profit margin. “Depending on their business life cycle, most businesses usually make losses within the first few years of operation and might find it difficult repaying the loans (principal and interests). Hence, most lenders shy away from availing facilities to start ups.”
He added: “In Diamond Bank, we have partnered with a lot reputable firms to overcome this challenge. We have our BET program we run with Enterprise Development Centre (EDC) where we have trained a lot of SME’s and helped them establish and grow their businesses.”
Also responding to a question on the bank’s ongoing business combination deal with Access Bank, he said: “The merger offers a great opportunity to customers of both Diamond Bank and Access Bank to enjoy a wide range of support aimed at growing their businesses.
“Nothing would change but we would continue to offer better opportunities and a wide range of assistance to our cherished customers.”