Where to go, what to know when planning a business |05 September 2015

Recently the Seychelles Investment Board (SIB) in collaboration with the Ministry of Finance, Trade and the Blue Economy and the Ministry of Investment, Entrepreneurship Development and Business Innovation organised a second Small and Medium Enterprises (SME) forum on Mahé. The aim was to equip emerging entrepreneurs with the necessary information regarding loans or credit when planning a business and of the different stakeholders involved in making a business happen.

Relevant stakeholders were there with presentations shedding light on what they offer and how clients should go about acquiring credit or loans from their institutions. The first such forum was organised on Praslin and La Digue in May 2015.

These meetings are part of other discussions that came about after various visits to small businesses in districts by both President James Michel and the Minister for Investment, Entrepreneurship Development and Business Innovation, Michael Benstrong, where they noted very healthy business environment but the entrepreneurs are facing difficulties getting access to loans, credit and locations.

To that effect, Minister Benstrong also said during the forum, that his ministry is working on clearer policies for people who are starting up a business and on the best place they should go to get assistance. There will also be training programmes, he added, to improve their capacity.

Seychelles NATION brings you a summary of what were presented at the forum by different stakeholders who provide loan, credit and other facilities for businesses.

The Seychelles Investment Board (SIB)

Set up in 2004, SIB acts as a one-stop window for investment. Its main objectives are to formulate investment promotion policies, plans and marketing strategies and undertake promotional activities to attract foreign and local investments;

advise government on strategies for investment policies and country image-building; stimulate the development, expansion and growth of the economy by promoting Seychelles as an international investment, business and service center and promote and facilitate the development of investment and business activities.

The different sectors potential entrepreneurs can invest in are tourism, fisheries, property development, energy, trade and professional services.

The Registration Division

Anybody planning to set up a business should first register his/her business at the Registration Division, which falls under the Department of Legal Affairs.  Its primary function is to ensure compliance with satutory requirements under relevant Laws and Acts. It also functions as a Registry of records relating to the lands, businesses, companies, associations, intellectual property, deeds and other documents subject to the formality of registration.
 
Apart from administering various pieces of legislation, the Registration Division also incorporates companies, registers businesses, registers and protects intellectual property – all related to businesses.

Small and Medium Enterprises (SME) loan scheme

In 2013 the government announced a financing proposal to assist small and medium enterprises (SMEs) with subsidised funds to boost their access to finance. In this new scheme, the government was to partner with commercial banks to provide loans to small and medium entrepreneurs as a means of facilitating the private sector to play a major role in driving economic growth in the country. A memorandum of understanding (MoU) was signed on July 15, 2013 by the government and the commercial banks to ratify the introduction of the scheme in the banking sector.

The key requirements a potential entrepreneur needs for credit applications on the SME loan scheme are a business plan, cash flow projections, financial statements, bank statements and the credit information system (CIS).

The key actions that are required for a successful credit application are that the applicant must register a business name to qualify for a loan facility under the SME scheme. The credit application should be submitted to the banks with the full set of valid documents to ensure that the banks can provide a quick turnaround time on the credit approval.

The Development Bank of Seychelles (DBS)

Founded in 1978, the Development Bank of Seychelles, which operates under a Decree, is a development financial institution with a specific mandate to assist in the economic development of Seychelles. It has over the years financed over 8,040 projects in excess of R2.1 billion and its portfolio continues to increase annually. Its product is limited to loans for business use only.

The bank also provides some financial guidance, advice and mentorship on potential investments and provides continuous support throughout the setting up stage, expansion and realisation of a project. It also provides loans in sectors like agriculture and horticulture, building and construction, tourism, services, fishing, industry, transport and renewable energy.

Small Enterprise Promotion Agency (Senpa)

Senpa is a co-ordinate and focused one-stop agency that provides development, support services and promotion to small entrepreneurs who are engaged in light manufacturing, processing, value added and related services. It promotes and facilitates entrepreneurship and enterprise development in Seychelles through targeted interventions.
 
It is to be the centre of excellence for entrepreneurship and sustainable SME sector development in Seychelles. Part of the agency’s strategy is to encourage businesses to use locally available natural resources and raw materials within identified sectors.

Businesses under the Senpa umbrella comprise tailoring, upholstery, manufacturing, art and craft, handicraft, food processing, professional services, horticulture, repairs and maintenance service.
Senpa guides you, promotes you, counsels you, trains you, introduces you to customers, opens doors for you. It promotes small businesses through exhibitions, fairs, trainings – local and international, sales outlets and workshops.

The Small Business Financing Agency (SBFA)

SBFA was set up to replace the Concessionary Credit Agency (CCA) with the objective of providing financial support to small entrepreneurs in Seychelles. It has a legal framework and is governed by the ‘Small Business Financing act, 2013’ which came into force in March 2014.  It has as mission to provide financial support for the activities undertaken by small enterprises.

Its objective is to help small businesses by providing financial assistance through concessionary loans to encourage the growth of micro enterprises and contribute to the overall strengthening of the economy.

SBFA finances projects for start-up as well as for expansionary activities in manufacturing and industrial related activities, small maintenance and cleaning contractors, handicraft, tailoring, artist and musicians, graphics, fishing, tourism, training, services, childminding, horticulture, bakery, backyard farming, hairdresser, manufacturing and any other activity that falls under the cottage industry.

Seychelles Energy Efficiency & Renewable Energy Programme (Seerep))

Seerep is a financing facility initiated by government, which was signed by the Ministry of Finance, Trade and Investment in partnership with the commercial banks and the Credit Union. The facility is being made accessible to the public through an affordable loan scheme by all the major commercial banks in Seychelles.

The main objective is to encourage the adoption of energy-efficient home appliances, e.g refrigerators, washing machine, cookers, lighting consumables, solar panels and other items of renewable technology by the domestic residential sector.

PV rebate scheme

Government, through the Ministry of Finance, Trade and the Blue Economy, in partnership with the UNDP-GEF, provides the funds for the Rebate Scheme. The Seychelles Energy Commission is responsible for its implementation and assists consumers by providing guidance/advice on PV systems and installation as well as energy efficiency practices. The Development Bank of Seychelles is responsible for holding and disbursing the funds to the installers upon receipt of Commissioning Certificates and Licenses following satisfactory completion of installation inspections.

The objective of the scheme is to promote the use of renewable energy, by reducing the one-off installation cost of a PV system connected to the national electricity grid. The rebate is given in the form of a cash incentive upon the purchase and installation of each PV system under the scheme. Applicant can benefit up to 25% of the rebate towards the purchase and cost of installation. This applies to both household and the business sector.

Compiled by M. Julie