SMEs turned power players: Standard Bank drives Africa’s growth

Standard Bank’s Business & Commercial Clients (BCC) division is deliberately focused on building a capability ecosystem to support small traders, agribusinesses, emerging manufacturers and entrepreneurs to grow into formal enterprises — or even become national corporates or cross-border multinationals.

In line with the Standard Bank Group’s purpose of driving Africa’s growth, the expansion of small and medium businesses (SMEs) holds the key to the kind of sustained economic expansion and broad-based employment on which long-term prosperity, stability and security is built.

In West Africa, where Standard Bank’s BCC division is now focused on Nigeria, Ghana, Angola, and Namibia, small businesses account for 40%-50% of GDP and, in some markets, up to 80% of employment. 

In specialist sectors such as agriculture, public services, manufacturing and oil and gas, where Standard Bank has advanced expertise, government policy and market conditions in West Africa are coalescing to present significant new opportunities for small business formation and growth. 

In agriculture, for instance, both Nigeria and Ghana now provide central bank-supported risk sharing and capital provision schemes to small farmers and agri-processors. The aim is to reduce import bills, increase food security and earn foreign exchange through the risk-managed provision of capital to small agribusinesses. For similar reasons, Angola is incentivising manufacturing. 

To leverage these opportunities and then to grow, businesses need more than just capital. They need to be understood, correctly advised, and then supported to execute in a nimble, digitised way. 

More than simply offering products, Standard Bank's BCC division is building a business support ecosystem in West Africa that allows easy, digital onboarding and instant access to capital based on relationships, rather than just collateral. Thereafter, simple, and easily accessed digital cash payment and collection solutions are required, along with direct access to experienced relationship managers.

These seasoned business builders share the critical insights, thought leadership and practical advice needed to develop and grow client businesses while also introducing small businesses to the right supplier or off-taker networks locally, cross-border and even globally. 

Thereafter, solutions such as Trade Suite and Trade Club assist with door-to-door import and export, including customs, logistics and foreign exchange.

As businesses grow, they are supported with broader knowledge networks including introductions to SME associations or local, regional and global industry or trade forums. 

Standard Bank’s Africa-China Import Solution, for instance, grew out of the challenges that African importers experienced in affordably sourcing, importing and shipping quality goods from China.

By partnering with a highly regarded sourcing agency in China, Standard Bank developed a service that allows African traders to select Chinese goods, suppliers and partners, directly through the bank. Then, working through the sourcing agency on the ground in China, Standard Bank ensures that all client goods are priced and quality controlled before dispatch.

The Africa-China Import Solution goes on to facilitate the end-to-end importing process, from letters of credit to customs, and to logistics and payment. 

On the export side, every year Standard Bank takes African nuts, wine, seed, chilli, edible oil and other agri-producers to the Chinese International Import Expo (CIIE). Attendance pretty much guarantees supply contracts as the full range of Chinese off-takers are present each year.

Standard Bank also takes business customers to the annual Africa-China Trade Expo, achieving similarly successful results. 

Helping small business clients correctly track and gather financial information, secure loans, meet bank-approved dealers or suppliers in SA or China, negotiate forex quotas or letters of credit, complete cross-border paperwork or finance vehicles, all under the guidance of seasoned business building professionals, can catapult a survivalist operation onto a multifactorial growth track.

Standard Bank now works with 101,000 small, medium, and larger enterprises across West Africa. The socioeconomic impact of growing and diversifying these businesses and their broader value chains into bigger and more able enterprises will sustain inclusive economic growth, broad-based employment and long-term prosperity in West Africa for generations to come. 

This article was paid for by Standard Bank.