Speaking at the third National Local Content Forum held on Monday at the University of Dar es Salaam (UDSM), NBC’s business development director Elvis Ndunguru said the bank had finalized two tailor-made products that include “supplier finance” and “purchase order finance” to meet the interests of SMEs that need cash to support their business.

“As a bank, we realized that many SMEs find it difficult to obtain financing to support their supply chain involving megaprojects due to many terms and conditions set by various financial institutions which include the requirement to deposit assets. in order to get loans, ”Ndunguru mentioned.

He added that with the bank’s new products that support local content, SMEs will only have to produce local purchase orders or service agreements as collateral to secure loans from NBC. “We finally listened to the long-standing outcry from SMEs and decided to accept LPOs and service agreements as loan guarantees to ensure that SMEs without assets can obtain the necessary financing to support their secure business contracts. “, did he declare.

He encouraged SMEs to adopt the bank’s bespoke product, adding that the bank will offer short-term 90-day to three-year loans depending on the interest of the potential borrower. “We will continue to invest in research in order to offer numerous banking products to meet the needs and interests of various SMEs in the country,” added NBC’s director of business development.

Minister of State in the Prime Minister’s Office (Investment) Geoffrey Mwambe, who attended the meeting, praised the bank for offering special products for SMEs and urged other financial institutions to follow suit.

Mwambe urged banks to consider lowering the interest rates charged on loans to SMEs, adding that the high interest rates not only make loan repayment difficult, but also ultimately affect the profit margin of the business. borrower.

Mwambe noted that the government has already developed a central bank credit referral system that can be used by banks to obtain details of various bank clients. “The practice around the world is that businesses are not financed by personal savings but by loans. Banks should consider offering various banking products to meet the needs of various customers, ”he advised.