Managing Director of Fidelity Bank Ghana, Julian Opuni has asserted that the Development Bank of Ghana’s entry into the Ghanaian banking sector is a positive development for SME-focused banks.

He expressed the conviction that DBG would play a strategic support role to enable these banks improve their capacity for doing business with Small and Medium-sized Enterprises (SMEs).

This, he believes, would also provide an impetus for SME-oriented Banks to expand their reach and venture into hitherto unexplored sectors.

Mr. Opuni made these comments when he spoke to a section of the media on Fidelity Bank’s SME proposition and their imminent collaboration with DBG.

He said, “Development Bank Ghana (DBG), provides a way of effectively speeding up the process of assisting SMEs. The structure of the banking sector in Ghana does not readily support long-term financing of SMEs.  This means that the support is usually focused on short-term cashflow-led lending. However, if we are going to develop the SMEs in the country, we need to start looking at opportunities to expand businesses, grow better access to markets and this requires longer term financing for SMEs.”

“What DBG brings on board is the provision of access to long-term financing for SMEs. Another major concern which DBG will help address is lending-related interest rates for SMEs. For the banks, DBG will also be instrumental in de-risking several areas of lending.”

Mr. Opuni also opines that DBG will create a platform for banks to collaborate in new ways and grow access to certain parts of the economy such as Agriculture, ICT and Tourism.

Fidelity Bank is one of Ghana’s most recognizable and influential players on the SME front with a long history of innovative support for local SMEs. Over the years, the Bank’s SME support initiatives have focused on key areas of concern such as access to finance, access to markets, capacity-building, customized initiatives for SMEs designed to fit within the infrastructure and framework of their operations.

In this pursuit, the Bank established the Fidelity SME Academy seven years ago with the goal of helping local SMEs to build capacity and consequently restructure their businesses to make them more attractive to financial institutions.

According to Mr. Opuni, “Fidelity Bank understands that SMEs are the lifeline of every economy and being one of the largest banks in the country, it is important to note that we also come to the table to grow this key sector of the economy. In the last ten years or so, Fidelity has actively been involved in assisting SMEs. We have also put in place innovative financing structures based on the life cycle of SMEs. We are now working on going forward in more innovative ways to help reduce the concerns around the crowding out effect that normally impacts these parts of the economy.”

With the introduction of DBG, Fidelity Bank expects a collaboration with the wholesale bank which will enhance the Bank’s SME proposition. It will help the bank make available long-term funds at competitive rates in addition to technical and advisory support.

Fidelity is therefore collaborating with DBG to avail the inherent opportunities to its large clientele of SME customers. The Bank will use its wide branch and agency banking network (which boasts over 5,000 agents spread across the country) as access points for new SME propositions which will be executed in partnership with DBG.