Contribution of small and medium enterprise to the economic development of Rwanda
par Valens NYANDWI
Universite Nationale du Rwanda - Licence 2013
Based on the research findings, skills of the researcher and other constraints accounted, we can finish this work by giving the following recommendations that aimed at further improve the production level for the great success of HUYE top three product clusters.
? Increasing the levels of formality of SMEs.
As the study revealed, registered SMEs were more likely to have a bank account and making use of a credit product. Moreover, because of the difficulty of separating small business owner's personal finances from that of the business, registering made it easier to make the distinction because business registration separates the business at law from its owner, thereby reducing the probability of an application for credit being rejected.
Increasing levels of formality also mean additional reporting requirements, thus promoting the availability of information available on a business, the lack of which can also be an impediment to accessing financing. In this regard, interventions to increase the levels of formality in the SME sector would have a positive impact on the SME sector being able to access finance.
? Improving information available on small businesses
As noted above, the additional reporting requirements resulting from registration would increase the information available on the business as well as improve the quality of that information. Other policy interventions aimed at improving the availability and quality of information available to reduce the problems of information asymmetry.
? Establishment of a Government Department to deal specifically with SMEs, entrepreneurship and support for this sector.
Main roles of the proposed harmonized department of SMEs and Entrepreneurship include;
(h) Facilitate compulsory registration,
(i) Act as a SME one stop shop,
(j) Information dissemination and SME awareness campaigns,
(k) House central repository of information on the SME sector,
(l) Establishment of a collateral registry, and
(m) Monitoring and evaluation of the schemes available.
? Improving the levels of managerial competence and skills
Regarding the poor level of managerial competence and skills of the small business owners, interventions should focus on providing training and courses that will improve the human resource capacities in this regard.
? Marketing and product awareness
As noted above, there is generally low uptake on available products, especially on Government schemes. One of the reasons, it is believed, for this poor uptake of facilities available, including financing, is the lack of a «single source of information», a one stop shop if you like of all available support programmers and how to access them .
? Promotion of developmental credit products/services
The Government of Rwanda sets out all the specific objectives of the Act; that is «to promote and advance the social and economic welfare of Rwandans, promote a fair, transparent, competitive, sustainable, responsible, efficient, effective and accessible credit market and industry, and to protect consumers, by:
(a) Promoting the development of a credit market that is accessible to all Rwandans people, and in particular to those who have historically been unable to access credit under sustainable market conditions».