FINANCIAL Securities Exchange (FINSEC) chief executive officer Collen Tapfumaneyi says the exchange is working on strategic plans to resuscitate the Growth Enterprises Market (Gem) Portal meant to help raise funds for small to medium enterprises (SMEs).
The FINSEC GEM Portal is a digital growth enterprises market platform launched by the exchange in 2020, which is designed to help SMEs and high-growth enterprises access debt and equity capital.
It serves as a simplified, technology-driven marketplace where qualifying businesses can apply for capital, get exposed to various financiers and advisers, and potentially list on the FINSEC exchange, offering an alternative to traditional bank loans.
According to FINSEC, the GEM Portal facilitates both the demand and supply sides of capital raising and is seamlessly integrated with other data sources such as banks, microfinance institutions, credit bureaus, and mobile money operators.
Talk of resuscitating the portal comes as, out of the 204 798 operational establishments, 76,1% are informal, generating more than US$14 billion in annual revenue, according to official statistics.
In an interview with NewsDay Business, Tapfumaneyi said funding was still low on the portal, hence why they were engaging different stakeholders to get funding.
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“It has been in pilot for quite a few years now, but a lot of people are still unaware of it. So, having put it all together, obviously what it means is when people are applying, if they meet a certain score, let’s say, somehow, they reach 100%, for example, everything is perfect, he will then expect to be funded,” he said.
“But if we do not have committed funding, why are we putting this person through all these processes? They then hit 100%, and there is no money? So, we say, let’s slow down.
“Let’s now look for funds, and what we have been doing is going to anyone who thinks he has got funds and saying, ‘look, at this system. Provided it meets all these things, can you commit to putting in some funds?’”
FINSEC’s efforts to support SMEs come amid the Zimbabwe Stock Exchange Holdings Limited announcing it was working on a bourse for these entrepreneurs called the Zimbabwe Entrepreneurs Exchange.
“He (the investor) wants to see the application first to put in funding. Applicants want to hear there are funds. So that is what we have been doing. So, I would say it has been running at a low scale, kind of a pilot and all that,” Tapfumaneyi said.
“Until the day we have our investors, because we want SMEs to come in their thousands, we need to advertise and say, now that we have a Gem Portal, wherever you are as an SME, come.”
The portal ensures the provision of appropriate capital and other support structures.
“As we are a marketplace, what we are just simply saying is we have created a platform where SMEs who are in need of capital can come on the platform, register, and then follow the process by providing the information that the platform is asking for,” Tapfumaneyi said.
“What this platform will then do is to screen them according to the quality of the information that they are providing. That will then give a score.
“With that score, we are able to determine who is the best and rank them and all that. Then the same platform will then expose it to the financiers, who then register as well, just like an SME, and indicate what they are looking for, what kind of investments.”