Over 150 SMEs to benefit from new financial management program

BUSINESS | SMEs | DEVT

KAMPALA - Over 150 Small and Medium Enterprises (SMEs) are to benefit from the new program to develop their enterprise. 

The program code-named “Accounting and Financial Management Systems” is to support the future growth, development, and access to finance opportunities of participating businesses by providing hands-on training on accounting and financing management best practices.

The program is to be implemented by Imuka Access in collaboration with Uganda Investment Authority (UIA), the Ministry of Trade Industry and Cooperatives (MoTIC), and the East African Venture Capital Association (EAVCA), with support from the University of Chicago, Booth School of Business.

While launching the program at Protea Skyz Hotel in Naguru, an outskirt of Kampala on September 20, the Director of Domestic Investment Division (DID) at UIA, Winnie Lawoko-Olwe noted that the program is important and timely especially when the UIA is also already working on supporting the internalization of SMEs to easily access the regional and international market.

Early this year in March, UIA signed a Memorandum of Understanding (MoU) with the Federation of the Small and Medium Sized Enterprises (FSMSE) to support SMEs to meet global standards.

The director Domestic Investment Division in Uganda investment Authority, Winnie Lawoko-Olwe, speaks during the launch of a three month accounting and financial management system program ay Protea Skyz Hotel in Kampala on September 20, 2022. (All Photos by Ronnie Kijjambu)

Under the arrangement, UIA is to support SMEs to develop investment plans, offer free land to SMEs in industrial parks, help them to get affordable finances to improve the quality of products, and secure international certification to easily access the regional and international markets.

Lawoko-Olwe noted that many SMEs fail for various reasons including inadequate funding, lack of relevant skills, record keeping, and failure to file returns among others which even makes it hard to access financing from credible institutions to improve their products and systems.

She stressed that such training will supplement other efforts by the government (UIA) to support many businesses to formalize their operations.

“As UIA we hold a big vision of seeing domestic investors transform. The transformation will require a complete turnaround because we are playing in a global environment that critically requires that we are transparent, accessible, and visible,” she added.

 She added that: “Our ethical and globally acceptable practices should be the best ones”.

According to Lawoko-Olwe, many business enterprises/businesses don’t live to see their second birthday, which must be reversed to boost local investment.

“This program will help address issues of internal competitiveness of SMEs but also address internal liabilities like failure to file returns and register businesses. We are eager to participate and contribute to this program to ensure our entrepreneurs keep proper accounting and financial records which can be presented for financing and investment opportunities,” she added.

According to the FSMSE, Uganda has over 734000 SMEs in different sectors.

The Lead at Imuka Access, Roy Masiga Gakuo said each enterprise is to be supported with sh5m to boost their initiatives after the training.

The program worth over sh1b will first be implemented in the Kampala Metropolitan area before being rolled out to other areas. 

“We hope to support over 150 SMEs in their future growth, development, and access to finance opportunities for SMEs. We want to ensure that all these SMEs we intend to train to get formalized in the way they do business to easily help them access financing in the future,” he added.

Team leader of Imuka Access, Roy Masiga Gakuo remarks.

Masiga noted that the program was prompted after realizing the challenge of limited financing and investments among SMEs in the country, all resulting from the informal nature of their business operations, lack of knowledge, and lack of relevant documentation due to poor accounting and financial management practices.

“The program will involve dedicated personalized training, coaching the implementation and adoption of accounting and financial management practices by a highly trained external professional financial expert over a period of three months,” he added.

He explained that all program participants will gain a deeper understanding of costing methodologies, financial record keeping best practices, budgeting, and financial planning techniques among other valuable skills.

At the end of the program, Masiga stressed that all participants will be able to submit application forms for financing with standard criteria that will be evaluated by potential capital providers and investors. He noted that all those interested in the program can apply through: http://app.imuka.co/

The EAVCA Country Representative, Acheng, the country said this will help to bridge gaps that SMEs have been experiencing while doing business.

She cited that many businesses lack the know-how and resources to develop systems and processes on their own, which hinders their growth.

“This limits the number of enterprises that are able to file for private investments and better capital providers. Therefore, technical assistance programs like this one are therefore important in addressing this gap as they provide the needed support for enterprises,” she noted.