Manzini- Small and medium enterprises (SMEs) can raise up to E5 million through the Eswatini Stock Exchange (ESE) as the exchange intensifies efforts to bring more growing businesses into the country’s capital market.
ESE Chief Executive Officer Simanga Mdluli said qualifying SMEs could raise between E50 000 and E5 million through the exchange’s SME Board, providing an alternative source of funding for businesses seeking capital for expansion.
However, despite the opportunity, no SME has yet listed on the board.
Mdluli said the exchange was now deliberately targeting SMEs as part of its strategy to deepen the capital market and encourage more local businesses to explore listing as a means of raising growth capital.
“We have had an SME Board in existence for quite a while now, but no SME is listed quite yet,” Mdluli said.
He said SMEs were critical to the economy as they were among the major drivers of growth and job creation.
This has prompted the exchange to work with institutions such as the Youth Enterprise Revolving Fund (YERF) and the Small Enterprises Development Company (SEDCO) to identify successful SMEs that could potentially be prepared for listing.
“We need them on the exchange,” Mdluli noted.
He said one of the major barriers preventing SMEs from accessing the capital market was a lack of knowledge about the stock exchange and the opportunities it offered businesses.
Mdluli said the ESE’s 2030 Strategy was therefore placing particular emphasis on visibility and education to ensure that entrepreneurs understood how the exchange could assist them in raising capital.
He said this was one of the reasons the ESE had taken part in the Eswatini International Trade Fair and hosted a business seminar aimed at creating awareness about capital market opportunities.
Another major challenge, according to Mdluli, was that many SMEs were not yet investment-ready.
He explained that because the stock exchange operates in a regulated environment, businesses seeking to raise money from the public must first demonstrate that they have the necessary governance and financial structures.
Mdluli said while the SME Board had requirements designed to accommodate smaller businesses, there were certain standards that the exchange would not compromise on.
These include corporate governance, audited financial statements and evidence that the company is resilient and has growth potential.
“You can’t just be a single operator. You can’t just be a sole proprietor with access to E5 million of people’s money,” he said.
Mdluli said businesses seeking to list would be required to have appropriate governance structures, including a board of directors.
The exchange, he said, had a responsibility to protect investors by ensuring that companies allowed to raise money from the public were credible and properly prepared.
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