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'Banks need new SME attitude'

Jul 20 2007 18:28

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Durban - Banks need a "mindset shift" when dealing with small medium and micro enterprises (SMMEs) and it was in their own interest to provide these entrepreneurs with the knowledge to move into the formal sector, KwaZulu-Natal's finance MEC Zweli Mkhize said on Friday.

Mkhize, speaking at the launch of an Absa Bank business advisory centre in Durban's Warwick Triangle area, said banks needed to do business with SMME's.

"Banks still have a long way when it comes to dealing with SMME's," he said.

Banks had the knowledge to provide to the informal sector. Citing the 5th South African Employment Report, released in April, Mkhize said there were 600 000 formal businesses and 2.1 million informal business enterprises.

"A lot of people need to be brought into the formal sector.

The banks need to show confidence in SMME's and focus on an SMME level."

Durban's deputy mayor Logie Naidoo said that the city estimated that annually a billion rand worth of business was conducted in the Warwick Triangle - almost all of it in the informal sector.

Warwick Triangle is about one square kilometre in size, but houses the city's busiest taxi and bus rank as well as the busy Berea Road railway station.

Naidoo quoted a 2003 United Nations report that said nearly 500 000 people a day pass through the area buying from various vendors.

Mkhize also said the government together with the private sector needed to instil a culture of entrepreneurship from a young age, starting in the country's schools.

 
 
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