Why people don't utilize business empowerment fund?

[Holicent]

Business empowerment fund is the government's way to encourage microfinance. The idea is that small businesses need better access to capital, and so the government will provide it for free. The problem with business empowerment funds is that they are not as popular as they should be. The number of businesses accessing them has been relatively low, even though the program was designed with a goal of providing loans to at least 50% of eligible applicants.

There are several reasons why this happens:

1) Some people do not know about this program or have forgotten about it when they needed a loan.

2) Some people may feel that their application will not be approved because their business does not meet the requirements for eligibility (e.g., size).

3) Some people may feel that they do not qualify for a loan because they cannot provide all of the required documents (e.g., business plan).

 

[Yusra3]

The vast majority of business people fail to use the business empowerment resources as they don’t know such aids exist in their jurisdiction. The same absence of good marketing of the small business owner even after providing subsidies, favorable loan rates and other incentives is a major impediment to the growth of small businesses. Moreover, the process for applying is complex with a lot of forms and rigid criteria and rules. Some do not try because they do not think that they will make the grade or they are afraid of the bureaucracy. Nevertheless, by educating small business owners and by simplifying applications, more of them could access these funds and benefit with new capital injection to drive their business growth.