Access to finance remains a significant constraint for small businesses during operation and growth in Eswatini despite their importance to the economy. However, the findings of the Blended FinScope Micro, Small and Medium Enterprises Survey for Eswatini 2023 reveal that a higher proportion of small businesses increasingly have access to formal and/or informal financial products and services.

Launched on 27 February, the survey's findings show that 84% of MSMEs have formal financial products in 2023 compared to 76% in 2017. Although the survey noted an increase in MSMEs using non-bank formal services such as Mobile Money, from 66% in 2017 to 75% in 2023, small businesses accessing formal banking services and products declined from 69% to 52% over the same period.

The survey further revealed that the number of MSMEs with some operating licence from the Ministry of Commerce, Industry and Trade or municipalities increased from 25% in 2017 to 43% in 2023. In addition, the number of micro-entrepreneurs rose from 78% to 96% over the same period. However, at least two-thirds of Eswatini’s MSME businesses are still unregistered with the Registrar of Companies.

Launched by the Minister of Finance, Hon. Neal Rijkenburg, alongside UNDP Resident Representative, Mr Henrik Franklin, the report sought to:

1. Assess the scope of MSMEs in Eswatini;

2. Describe the levels and landscape of access to financial products and services – both formal and informal – as well as track the level of financial access since 2017;

3. Identify the most binding constraints to MSME development and growth with a focus on access to financial services and products; and,

4. Identify the drivers and barriers to financial barriers for MSMEs.

Speaking at the event attended by policymakers, development partners, and stakeholders in the business and finance sector, Rijkenburg urged all players to take appropriate action based on the survey's insights.  

“Let us foster collaboration among stakeholders, advocate for policy changes, and invest in initiatives that prioritise MSME financial inclusion,” he said, adding: “Together we can create a landscape where every entrepreneur, regardless of the size of their business, has the opportunity to financial services they need to succeed.”

The Centre for Financial (CFI), a semi-autonomous institution under the Ministry of Finance, conducted the survey in partnership with Finmark Trust, with technical and financial support from the SADC Secretariat, European Union and UNDP.  

Addressing the same event, Franklin said the survey not only focused on financial inclusion but also looked at the structure of informality in Eswatini and its drivers. This dual focus necessitated a change in approach, which was initially only household-based to also be enterprise-based.

“I want to express my profound appreciation to CFI, Central Statistics Office, and FinMark Trust for their flexibility in adapting the methodology, despite the sampling challenges. Such innovative partnerships transcend the usual and hold the key to ground-breaking solutions accelerating progress,” he said.        

Franklin added that MSMEs are close to UNDP’s heart evidenced by the partnership with the Ministry of Commerce, Industry and Trade in launching the Eswatini National MSME Policy (2024-2029) and Ingelo Local Certification Scheme to create an enabling environment for small businesses, among other initiatives. Ingelo aims to promote the high-quality production capacity of local MSMEs so they can initially access domestic markets while paving the way for ultimately accessing and being competitive in the African Continental Free Trade Area (AfCFTA) and global markets.

Other speakers at the event included CFI Chief Executive Officer, Ms. Sizakele Dlamini, the CEO of FinMark Trust, Mr Brandan Pearce, and Rado Razafrindako, who represented the SADC Secretariat.