EnuguSME, Author at Enugu SME Centre

SunFunder closes US$70m solar energy fund

AFRICA – Investment company SunFunder, a company specializing in solar energy, has completed the financial mobilisation for its Solar Energy Transformation (SET) fund worth US$70 million.

The multi-investor fund has been closed thanks to an investment by Oesterreichische Entwicklungsbank AG (OeEB).

The SET Fund was launched by SunFunder with the aim of accelerating the electrification process in Africa and this financing mechanism has attracted many other investors like Swedfund which injected US$12 million in September 2020.

The fund has also received investment from American Development Finance Corporation (DFC), Calvert Impact Capital, Ceniarth, the IKEA Bank of America Foundation, Mercy Investment Services, Schmidt Family Foundation, as well as several individual investors through the Toniic Impact network.

“Off-grid solutions have played a key role in providing clean, affordable, and reliable energy, especially to rural populations. We are therefore proud to team up with SunFunder and to support this innovative fund that improves access to energy for millions of people”

“Off-grid solutions have played a key role in providing clean, affordable, and reliable energy, especially to rural populations. We are therefore proud to team up with SunFunder – an experienced and impact-conscious partner in this field and to support this innovative fund that improves access to energy for millions of people,” said Sabine Gaber, member of the OeEB Board of Directors.

In Africa, SunFunder particularly supports suppliers of off-grid solar systems, which accelerate the electrification of rural areas and provide clean energy to businesses.

In Nigeria, for example, SunFunder has invested US$4 million in Daystar Power to provide solar energy to industrial and commercial customers.

The investment company has also been involved in several fundraising initiatives, including those of solar-powered irrigation system supplier SunFunder and solar home systems supplier PEG Africa.

SOURCE LINK

How SMEs can scale up under the AfCFTA

SMEs can to take advantage of the incentives provided under the new Finance Act to scale up under the AfCFTA.

Independent of the AfCFTA, the Federal Government of Nigeria has in recent times embarked on some far-reaching reforms aimed at enhancing ease of doing business both for the Small and Medium-sized Enterprises (“SMEs”) and across other strata of business in Nigeria. Some of these reforms can be seen in the areas of policies, laws, business formation and registration, post-incorporation filings and taxation. Two of the legislative instruments which are critical to these reforms deserve some mention here:

Companies and Allied Matters Act, 2020 (CAMA, 2020)

The signing of CAMA, 2020 into law by President Muhammad Buhari on 7th August 2020 came as a very cheering news to the SMEs community. Some of the provisions which impact directly on SMEs include but not limited to the following (i) a single member/shareholder for a private company (ii) minimum share capital in place of authorized share capital. This allows promoters of business to pay for only shares that are needed at the point of incorporation; (iii) exemption of SMEs, small companies or companies with single shareholders from the requirement of appointing Auditors to audit their financial records (iv) filing, share transfer and meetings can be done electronically by private companies (v) Statement of compliance which was hitherto signed by legal practitioners can now be signed by the business owner or his agent (vi) introduction of Limited Partnerships and Limited Liability Partnership thereby providing options for promoters who may want to incorporate partnership instead of limited liability companies (vii) Appointment of company secretary now optional for private companies (viii) AGMs and other company meetings can now be held virtually, amongst other reforms.

Finance Act, 2020

Complementing the reforms under the CAMA 2020 is the Finance Act. Enacted first in 2019, the Act was further expanded and re-enacted to among other things address the negative impacts of COVID 19 on small businesses and this led to the new Finance Act, 2020. The new Finance Act was signed into law on 31 December 2020 and took effect from 1st January 2021. It introduced over 80 amendments to 14 different laws such as the Personal Income Tax Act, Companies Income Tax Act, Capital Gains Tax Act, Value Added Tax Act, Customs & Excise Tariff Act, Tertiary Education Trust (TET) Fund Act, Fiscal Responsibility Act, Public Procurement Act, CAMA, Nigerian Export Processing Zone Act and Oil and Gas Export Processing Free Zone Act. SMEs are expected to take advantage of the incentives provided under the new Act. SMEs with a turnover of less than N25 Million are exempted from Companies Income Tax and TET tax amongst other incentives. SMEs engaged in primary agricultural production are qualified for pioneer status for an initial period of four years and an additional two years.

MSME Survival Fund

In a bid to ameliorate the impact of COVID-19 on small businesses, the Federal Government of Nigeria launched the N75 Billion Survival Fund for Micro, Small and Medium Enterprises (MSME). The Fund which was touted as part of the economic sustainability Plan of the Federal government is meant to support small businesses to meet basic operational needs and provide funding in order to boost the production capacity of MSMEs in Nigeria.

The AfCFTA

The aforementioned reforms and policy interventions provide the needed environment for small businesses in Nigeria and the coming of the AfCFTA could not have been at a better time. The critical question remains, how SMEs can leverage the opportunities provided under the AfCFTA to scale up their operations. SMEs are often considered the economic backbones particularly in developing countries as they account as major contributors to the GDP and in the area of job creation. Nigeria has a vibrant SME ecosystem. Out of the 95 Million SMEs in Africa, over 45 Million of them are in Nigeria. Thus, on the continent Nigeria plays a huge role, accounting for close to 50% of SMEs. In terms of economic impact, SMEs contribute 48% of national GDP in Nigeria, make up the 96% of businesses and contribute 84% of employment. Despite the contribution to the economy, SMEs in Nigeria in particular, have continued to grapple with the challenges of high cost of capital and lack of access to funding as well the inability to compete globally. Due to the largely informal nature of SMEs in Nigeria, obtaining data for the purpose of planning has also been difficult. On this, the role of Small & Media Enterprises Development Agency of Nigeria (SMEDAN) in amongst other things, formalization of SMEs in Nigeria should be encouraged.

One of the objectives of AfCFTA is providing free movement of goods and services on the continent and it is expected that the new trade bloc will afford SMEs the opportunities to scale up and lead to value chain aggregation across Africa. In addition to the limitations identified above, poor infrastructure, multiplicity of regulations and taxes and lack of skills in international trade equally militate against the growth of SMEs. To make matters worse, most SMEs often fail to appreciate the role of professional advisors such as lawyers in the formative stage of their business. The role of trusted professional advisors in navigating the regulatory bottlenecks should not be a trade-off for cost-saving measures as the value of these technical and professional services to SMEs cannot be over-emphasized.

To increase global competitiveness of the SMEs, harmonization of business rules and regulations across Africa is required. Governments in the member States should invest heavily not only in physical infrastructures but in digital technology as most SMEs particularly those in service sector rely on internet and digital platforms to drive their operations. For instance, the expected gains under the CAMA, 2020 have not been fully actualized as recent experience has shown that SMEs still face challenges accessing and using the Corporate Affairs Commission’s online platform because of slow and poor services. Related to this is the need for patient capital to encourage start-ups in order to drive innovations amongst the teaming youths.

Access Bank unveils SwiftPay to boost Digital Payments for SMEs

In the bid to boost the facilitation of payments between SME and retail customers in the digital space, Access Bank Plc recently unveiled SWIFTPAY, a digital payment service that facilitates the receipt of business payments by enabling customers make quick, easy and secure digital payments on social media platforms to merchants.

Speaking to newsmen during the launch of the new service in Lagos, Group, Head, Emerging Businesses, Access Bank plc, Ayodele Olojede, noted that the lockdown, experienced in 2020 as a result of the COVID-19 pandemic, resulted in less in-person interactions and less in-person payment options. She revealed that statistics from a survey carried out post-lockdown showed that MSMEs were impacted by cash flow, revenue and sales while adding that the impact of the pandemic made more apparent the lack of infrastructure and access to digital resources for small businesses.

“This is why Access Bank introduced SWIFTPAY to support the digital transition and growth of SME businesses. This product is part of the Bank’s commitment to support SMEs to meet their business objectives despite the times. The new service comes in form of a payment link that can be hosted on merchants’ social media pages and sent to anyone to pay and conclude business transactions. It is easy and takes less than 5 minutes for interested merchants to sign up as it is convenient and time saving for everyone.

Ayodele also revealed that the Bank is committed to providing very practical solutions that support the growth of small business in Nigeria.

“SWIFTPAY is free and the processing charge is discounted up to 15 per cent to ensure merchants keep most of their earnings. In recent times, e-commerce has been challenged with the rise in fraud on social media, we have ensured that every merchant registered on SWIFTPAY carries a ‘verified by access ‘ stamp to authenticate the page giving customers confidence when they transact.

“We have been focused on providing solutions targeted at boosting the economy because we believe it is our responsibility to contribute to the stimulation of economic growth. With the launch of “SwiftPay by Access”, we are renewing our commitment to providing the much-needed technological support to our SMEs.” Olojede concluded.

Access Bank Plc is recognized as one of the most innovative financial institutions in Africa. With over 40 million customers and 600 branches nationwide, it offers a range of products and services tailored to suit needs and lifestyle of its customers across multiple segments.

To know more about SwiftPay, please click HERE.

SOURCE LINK

TAX: Oman to cut income tax on SMEs

According to state television, Oman will reduce income tax for small and medium enterprises in 2020 and 2021, as well as give long-term residency permits to foreign investors.

The proposals, which were reported on state television, are part of Oman’s Vision 2040, which aims to diversify the economy away from oil, which accounts for the majority of the country’s revenue.

Oman’s economy is one of the poorest in the Gulf, having been hit hard by the coronavirus pandemic and low oil prices. Last month, the International Monetary Fund predicted that the economy will contract by 6.4 percent in 2020, with a moderate rebound to 1.8 percent growth this year.

Income tax will also be lowered for businesses that will start operating this year in sectors aimed at economic diversification.

Until the end of 2022, Oman will also reduce rent in the Duqm Special Economic Zone and industrial areas.

It said granting longer residencies for foreign investors would be done “in accordance with specific controls and conditions that will be announced later after their study is completed by the Council of Ministers, in addition to incentives related to the market.”

The cabinet also approved a long-term urban growth strategy that “is considered a key enabler for achieving Oman Vision 2040,” state TV said citing Oman’s ruler, Sultan Haitham bin Tariq al-Said.

SOURCE LINK

NSE completes demutualisation

The Nigerian Stock Exchange (NSE) has received final approvals of its demutualisation plan from the Securities and Exchange Commission (SEC) and Corporate Affairs Commission (CAC) respectively.

With these approvals, The Exchange has now completed its demutualisation process.

Under the demutualisation plan, a new non-operating holding company, the Nigerian Exchange Group Plc (‘NGX Group’) has been created.

The Group will have three operating subsidiaries, namely: Nigerian Exchange Limited (NGX Limited), the operating exchange; NGX Regulation Limited (NGX REGCO), the independent regulation company; and NGX Real Estate Limited (NGX RELCO), the real estate company.

All the entities have been duly registered at the CAC.

Abimbola Ogunbanjo, NSE Council President, said: “Successful demutualisation was one of my fundamental objectives when I assumed the Presidency of The Exchange.

The SEC’s decision today to approve the NSE’s demutualisation plans brings this aspiration to a successful conclusion in a process that included the passage of the Demutualisation Act through the National Assembly.

We are elated that this milestone has been achieved as we celebrate the 60th anniversary of the commencement of trading at the Exchange and now look forward to the future public listing of its shares on NGX Limited.

On behalf of the NSE, I would like to warmly thank all those that have worked assiduously to achieve this watershed event on our journey to make the NSE a multifaceted exchange that extends across various markets and geographical regions.”

The approvals by the SEC and CAC signify that the NSE can now activate its Transition Plan to a new operational structure and holding company.

The extensive Transition Plan, taking the Group and its subsidiaries through to full Operational Launch, covers legal and practical changes to enable the functioning of the new corporate structure, with no loss of service and a seamless transition for market participants.

The Transition Plan will also see the inauguration of Boards for each of the new entities, staff reallocation to their respective functions within the operating subsidiaries, operationalisation of business plans and budgets, technology systems transfer, and the requisite arm’s length agreements between the entities.

Upon Operational Launch, the Group’s new brands, including a new website, will be unveiled and the Group will be in a position to execute on its strategic vision.

Stakeholders, including our new valued shareholders, will benefit from The Group’s enhanced Corporate Governance framework, access to capital to fund strategic developments and a more globally competitive Exchange.

The approvals also enable the shares of NGX Group Plc, which have been registered with the SEC, to be allotted to the membership pursuant to the Court approved Scheme of Arrangement.

Ahead of its listing on NGX Limited, the shares of NGX Group Plc will be available for bilateral trades to be executed in line with extant rules and regulations of the Nigerian capital market.

Otunba Ogunbanjo will serve as the inaugural Chairman of NGX Group Plc’s Board of Directors.

Oscar N. Onyema, the new Group CEO of NGX Group Plc, said: “The Nigerian capital markets should play a role commensurate with Nigeria’s status as Africa’s largest economy.

At the Nigerian Stock Exchange, we have a vision that the new group will become the premier exchange hub for Nigerian businesses and for the African economy.

We are implementing a series of measures towards this goal, demutualisation being a critical milestone.

The completion of demutualisation is a truly significant moment, and we welcome the new possibilities that have opened up for us today.”

Investors Lose N371.33bn as NSEASI Dips…

Investors Lose N371.33bn as NSEASI Dips by -1.80%, Close Below 39,000bpts

Equities market closed today on a negative note, as NSEASI depreciated by -1.80% to close at 38,686.85 basis points as against +0.17% appreciation recorded previously.

Its Year-to-Date (YTD) returns currently stands at -3.93%.

Market Breadth

Market breadth closed negative as CHAMPION led 14 Gainers as against 24 Losers topped by UBA at the end of today’s session

– an unimproved performance when compared with previous outlook.

Market Turnover

Market turnover closes positive as volume moved up by +64.83% as against -49.92% downtick recorded in the previous session.

UBA, NOTORE and MBENEFIT were the most active to boost market turnover. MTNN and UBA topped market value list. Investors lose.

Volume Shockers

MTNN leads the list of active stocks that recorded impressive volume spike at the end of today’s session.

NSE30 1087.68 -0.01% NSE BANKING 375.22 -0.03% NSE INSURANCE 194.41 1.26% NSE INDUSTRIES 1933.61 0.47% NSE OIL 262.26 1.01% NSE ASeM 729.87 0.00% DANGOTE 116.84 0.47% ELUMELU 89.02 -6.79%

Investors lose

SOURCE LINK

Inflation: February Headline May Jump To 17.27%

We are estimating a sharper increase in headline inflation to 17.27% for February 2021 up from 16.47% in January. If this happens, it will be the 18th consecutive monthly increase in Nigeria’s inflation rate. It will also be the highest level in 46-months.

Inflation is moving further away from the upper band of the CBN’s 6- 9% target. It is likely to impede output growth. Real GDP growth increased marginally by 0.11% in Q4’20 after two consecutive quarters of negative growth.

In the last two months, we have seen a divergence between the direction of month-on-month and annual inflation due to the base year effects and supply shocks. The month-on-month inflation is estimated to remain relatively flat at 1.49% (19.47% annualized) in February.

We have also seen the impact of high- powered money and the massive borrowing of the FGN via the CBN. The impact of the crowding out of private investors from the public debt market by the CBN printing money is now playing out in higher price inflation.

Food and core sub-indices to increase

We expect the food and core sub-indices to move in tandem with the headline inflation. Food price pressures will remain the primary driver of inflation, rising to 21.98% in February. The impact of the recent blockade of food supply from the Northern states to the south-west is unlikely to reflect in the February inflation numbers.

However, the impact will be felt in the month of March. Core inflation (inflation fewer seasonalities) is also projected to cross the 12% threshold to 12.02% in February due to exchange rate pressures and higher logistics costs. The impact of higher transport fares will be more potent in March.

Inflation expectations more to the upside: Tighter monetary policy stance likely in H2’21

Expectations, which is the basis for policy formulation is more to the upside due to supply shocks emanating from the food blockade and heightened insecurity, exchange rate pass-through effect and higher energy and logistics costs.

Recently, the naira has been allowed to crawl up to N411.63/$ at the I&E window, whilst hovering around N480- N482/$ at the parallel market. This coupled with the periodic dilemma on the adjustment of PMS price will continue to increase production costs and push up commodity prices.

The persistent rise in inflation increases the chances of a tighter monetary policy stance albeit in H2’21. The CBN has indicated that it is unlikely to change its accommodative stance in the near term.

The MPC committee will continue to monitor the impact of recent policies and stimulus on economic growth while using orthodox tools to mop up liquidity and contain inflationary pressures.

AXA Mansard empowers female business owners

AXA Mansard, a member of AXA, the global leader in insurance and asset management as part of the its plans to foster women empowerment and capacity building has collaborated with SME 100 Africa to empower one female business owner at the 2021 International Women’s Day Conference.

The conference which held on Thursday March 4, 2020 was themed ‘Choose to Challenge: Achieving An Equal Future in a COVID-19 World’.

It held in a hybrid (both virtual and physical) format and featured sessions from various successful female business owners such as Mrs. Funke Bucknor-Obruthe, the CEO of Zapphire Events Limited and Fade Ogunro the CEO of Bookings Africa.

It also featured a financial literacy session facilitated by AXA Mansard’s investment officer, Nneoma Mere.

The highlight of the session was the business pitch session where female entrepreneurs presented their pitches and keenly competed for a prize of One Million Naira (N1,000,000) towards their businesses.

GreenHill Recycling Limited founded by Mrs. Mariam Lawani – a social enterprise that provides sustainable solutions to the waste management crisis in Nigeria through recycling and upcycling emerged as the winner of the prize.

Commenting about the pitch competition, the Chief Customer and Marketing Officer at AXA Mansard, Mrs. Olajumoke Odunlami noted that “The pitch session was a thrilling and impactful experience for me.

I am very privileged to have been a part of this session and to have seen the great things that women are doing in business.

Women are the force for change and we must continue to strive to ensure that we are visible and relentless.”

Mrs Odunlami concluded by saying that “AXA is committed to gender equality through implementation of gender initiatives as well as sound and inclusive policies, processes and culture across the organisation.

We believe that women are the key to progress as they are a vital force for growth and development around the world.

We encourage women to take advantage of our SHE for Shield initiative which is tailored towards empowering women.

Every business owner who has made a pitch here is a winner as they are all doing fantastic things with their businesses.

I congratulate the winner of the prize money, Mrs. Lawani whose company is targeted at sustainability.

We at AXA are strong advocates of sustainability and this is also reflected in our targets and policies.

AXA Mansard was incorporated in 1989 as a private limited liability company and is registered as a composite company with the National Insurance Commission of Nigeria (NAICOM).

The Company offers life and non-life insurance products and services to individuals and institutions across Nigeria whilst also offering asset/investment management services and health insurance solutions through its two subsidiaries – AXA Mansard Investments Limited and AXA Mansard Health Limited respectively.

AXA Mansard was listed on the Nigeria Stock Exchange in November 2009.

SOURCE LINK

Government targeting gender-sensitive public financial management processes

The federal government has disclosed that it is entrenching public financial management processes that would be more gender-sensitive and ensures the availability of credible disaggregated data.

The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, in her goodwill message yesterday during the commemoration of the “2021 International Women’s Day National Policy Dialogue,” noted that through the implementation of Finance Acts 2019 and 2020, the federal government is providing tax relief and other forms of support to micro, small and medium enterprises (MSMEs), many of which are owned by women.

Ahmed said: “We are also working to ensure that our public financial management processes are more gender-sensitive, and that credible disaggregated data is available. Such a focus will yield sustainable and scalable change.

“We are also scaling up existing and developing new interventions at the intersection of gender equality and fiscal policy/public financial management. These include gender- responsive budgeting, and assessments of the gender responsiveness of key fiscal interventions (including fiscal stimulus packages) with specific commitments aimed at improving the safety, livelihoods, and economic status of women and girls.

“This is an area in which we at the Ministry of Finance, Budget and National Planning are focusing more deliberately and will be prioritising, in partnership with the Ministry of Women Affairs and other critical stakeholders.”

She pointed out that women and girls have continued to bear the disproportionate burden of the COVID-19 pandemic on the frontlines, in their homes and across various sectors and stated that they must be given the opportunities and tools with which to be socially, financially, and economically empowered.

The minister advocated that every woman and girl should be guaranteed safety in their respective homes, schools, communities, and places of work while calling for an end to gender-based violence and the so-called ‘shadow pandemic’ once and for all.

The minister observed that gender equality and women’s economic empowerment remained critical to ensuring inclusive and sustainable development.

“If we fail to act now, the goals espoused in the 1995 Beijing Declaration and Platform for Action, the 2030 Agenda for Sustainable Development and the African Union’s Agenda 2063 will remain out of reach,” she said.

She described this year’s theme “Women in Leadership: Achieving an Equal Future in a COVID-19 World” as a resounding call to celebrate the unfailing resilience and inspiring leadership of women and girls around the world.

She also applauded the efforts of the Minister of Women Affairs, Mrs. Pauline Tallen, adding that Tallen has been a tireless advocate for gender equality, and had taken a bold stand in the campaign to end violence against women and girls.

Ahmed noted that internationally, the country is proud to have the United Nations (UN) Deputy Secretary-General, Mrs. Amina Mohammed, and the recently appointed World Trade Organisation’s (WTO) Director-General, Dr. Ngozi Okonjo-Iweala, among its gender advocates and champions of change.

gender-sensitive

SOURCE LINK

Investor Education Will Encourage Investor Participation

Investor Education Will Encourage Retail Investor Participation in Equities

Regulatory steps geared towards deepening
investor education across the nation will increase retail investors’ participation in the Nigerian equities market.

Mr. Charles Fakrogha, the Chief Operating
Officer (COO), Supra Commercial Trust Limited, said this while reviewing
the latest report on “Domestic and Foreign Portfolio Investors Activities In
Equities Trading”| published by the Nigeria Stock Exchange (NSE).

Fakrogha noted that the COVID-19 pandemic
adversely affected retail investor confidence, giving room for institutional investor
dominance of the market.

The capital market analyst said that
institutional investors had leveraged their superior resources and technology
to carry out trading activities that enabled them benefit from hidden-value
opportunities and education.

“Retail investors are expected to drive daily
market action, but their restrained attitude towards the market made them less
adaptable to the COVID-19 pandemic”.

In the area of investments, he reiterated the
need for policymakers and regulators in Nigeria to incentivize domestic
portfolio investors in the country.

Fakrogha was happy that the tide had changed
with domestic investor transactions dominating activities for January 2021 with
about 74% of trading transactions. This was in comparison to foreign investor
transactions which accounted for about 26% of traded transactions.

The analyst stressed the need for a capital
market that thrives on transparency, investor protection, and efficiency, which
will attract more foreign direct investments (FDI) into the economy.

The equity market trader advised that key
market operators and regulators should leverage technology and strengthen
cybersecurity.

Investor Education Will Encourage Retail Investor Participation in Equities

Enugu SME Centre

All posts by : EnuguSME

SunFunder closes US$70m solar energy fund

How SMEs can scale up under the AfCFTA

Companies and Allied Matters Act, 2020 (CAMA, 2020)

Finance Act, 2020

MSME Survival Fund

The AfCFTA

Access Bank unveils SwiftPay to boost Digital Payments for SMEs

TAX: Oman to cut income tax on SMEs

NSE completes demutualisation

Investors Lose N371.33bn as NSEASI Dips…

Inflation: February Headline May Jump To 17.27%

Food and core sub-indices to increase

Inflation expectations more to the upside: Tighter monetary policy stance likely in H2’21

AXA Mansard empowers female business owners

Government targeting gender-sensitive public financial management processes

Investor Education Will Encourage Investor Participation

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