Bursting a Long-held SME Funding Myth

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SMEs have long argued that they don’t get adequate support from financial institutions, but the recent testimonial campaign by Stanbic IBTC, which featured neighbourhood SMEs from across the country, seems to puncture such claims, writes Raheem Akingbolu

The SME funding myth

If one were to interview the 37 million small and medium scale enterprises (most recent figures from Small and Medium Enterprises Development Agency (SMEDAN) and the National Bureau of Statistics) in the country, it is most likely that more than 80% of them will lament a lack of access to funding as a major drawback. Many will certainly complain that financial institutions are not supporting them well enough.

Unfortunately, many have come to believe this to be true. Financial institutions may have unwittingly helped to perpetuate this belief. In time past, the communication one sees about banks’ loan facilities and customer base are those represented in their financial reporting; usually, some uncompromising figures that stare right back at the reader from the pages of the reports. These figures, which tell the story of the loan facilities a financial institution has committed to businesses in a calendar year and the number of customers it has, are grossly inadequate in telling a complete compelling story. Indeed, not many stakeholders have the time and the required patience to pore over those figures and not many see the need to. And so the myth that financial institutions do not support businesses but would rather back a cash-and-carry venture continues.

Correcting a long-held perception

However, the myth may be getting worn at the seams with the recent bold move by Stanbic IBTC Bank to feature in a testimonial campaign some of the businesses across the country it has supported with banking solutions, facilities and advisory services over time. In essence, the financial institution is giving a voice and a face to each one of those key customer or loan figures represented in its financial reporting.

The Stanbic IBTC testimonial campaign

The campaign, which broke early this year, features real and known businesses across the country to have benefitted from Stanbic IBTC Bank’s support and partnership. The holistic marketing campaign includes both online and offline bits on digital, radio, press and outdoor, and is expected to run all-year long. On radio, owners of featured businesses were engaged in short interviews on their relationships with Stanbic IBTC Bank and their impression of the bank. The business owners were glowing in their praises while highlighting some of the beneficial traits that endeared them to the bank. “We’ve been together with Stanbic IBTC for the past 10 years. Stanbic IBTC actually takes the time to sit down to get to know the customer,” says Ibrahim Bayero, managing director, National Trucks Manufacturers Limited, a leading truck and agricultural machinery assembly plant based in Kano. On his experience with Stanbic IBTC Bank, Bayero says it has been “a remarkably positive experience” and that “Stanbic IBTC is a listening bank.”

According to Alhaji Sabitu Mohammed Yahaya, managing director of Jifatu General Enterprises Nigeria Limited, of all the banks he had approached, Stanbic IBTC Bank understood his need for business perpetuity and it was easy for him to make it his bank. Also, Alhaji Munzali Muhammed, managing director of Mazafmini Depot Limited, a commodity distribution merchant, may very soon wish to consider a name change for his business, with the removal of the word ‘mini’ from ‘Mazaf’. He says with the support from and expertise of Stanbic IBTC Bank, he has grown “from a mini depot to a mega commodity distributor merchant,” adding, “Whatever support you need you can always count on Stanbic IBTC Bank.” Mrs Omoyemi Chukwurah of Seams and Stitches, who is featured on outdoor billboards, says “Stanbic IBTC gave me wings to fly.”

The testimonials cut across sectors and industries, from manufacturing, distribution, communications to trading, investment and agriculture, among others. The various industries featured underline Stanbic IBTC’s value proposition as an end-to-end financial services solutions provider and its pledge to assist businesses and individuals realize their latent potential and accomplish their goals through financial solutions that deliver outstanding value.

A commitment to partnership for SME growth

Perhaps the most significant element in the testimonials is the demonstration of the assurance that Stanbic IBTC is a partner in progress. There is a feeling of pride the testimonials project, which shows the level of confidence Stanbic IBTC Bank has in the businesses it supports, much like a mother will brag about and showcase a successful child. The interviewees used terms such as ‘know the customers’, ‘listening bank’, ‘support’, ‘care’ while describing their relationship with Stanbic IBTC Bank. These terms are indicative of a partnership which transcends mere bank-customer relationship. A partner has a deeper and genuine interest in the growth of the other partner, well beyond pecuniary needs, and is willing to go the extra mile to make the relationship worthwhile. Supporting local businesses and ensuring their growth is an article of faith with Stanbic IBTC Bank.

The financial institution has undoubtedly spent a good sum of money to give free advertising and publicity to its partner SME businesses. The massive impact of the testimonials, in terms of leads and new businesses, on the featured SMEs can only be imagined. Testimonial campaigns may not be entirely new in the financial services industry and in other industries in the country, but the scale of Stanbic IBTC’s ongoing testimonials has certainly pushed the boundaries.

Pushing the boundaries for better service

Stanbic IBTC is not new to pushing the boundaries of service quality and delivery, customer relations and satisfaction. Indeed, the Stanbic IBTC Group is a bellwether of innovation across the entire spectrum of financial services: from retail and corporate banking, pensions, assets management to trusteeship, insurance brokerage, stockbroking and custodian services. It continues to simplify its processes to ensure that customers are better served. Only recently, the bank expressed its willingness to digitize its entire operations when it launched the first self-service digital bank branch in the country. “We have long embraced digitalization to strengthen our operations and processes, make them more accessible, efficient and cost effective,” says Chief Executive of Stanbic IBTC Bank, Dr Demola Sogunle.

Other SME-focused initiatives

SMEs and other businesses have continued to benefit from a number of key initiatives by the bank targeted at helping them achieve growth. Stanbic IBTC Bank says the SME sector is pivotal to the economic growth and development of any nation and as such, must ensure that operators get the right support in terms of infrastructure, financing and capacity building for sustainability. It is such thinking that drove the bank’s establishment of a unique digital banking platform, the SME BizDirect, to support small businesses with transactional products; savings and investment solutions; lending products; and wealth protection solutions. A yearly SME training series was equally conceived to provide innovative marketing, financial and management skills that are useful to small businesses and which will provide the skills set needed for their businesses to grow.

Even as Stanbic IBTC continues to demonstrate its readiness to promote SMEs, it is incumbent on business promoters, no doubt, to ensure capacity building. Experts have said capacity building and not finance, as wrongly believed by many business owners, is the major impediment to their growth. The Stanbic IBTC Bank testimonial campaign has shown clearly that there is a bank willing not only to provide funding for SMEs but ready to travel on the journey with them to ensure business success and continuity.