A deposit-taking savings and credit co-operative society is leading an initiative to provide affordable workspace, loans, and capacity building to small and medium enterprises (SMEs) to formalise their activities.
The move by IAPAZ Professionals Savings and Credit Cooperative Society Limited comes at a time when the government is stepping up efforts to ramp up formalisation and tap into a sector estimated to be generating over US$14 billion in revenue annually.
Available statistics from the Zimbabwe National Statistics Agency show that the informal sector, largely made up of SMEs, accounts for 76,1% of all businesses.
IAPAZ Professionals Savings and Credit Cooperative Society Limited is registered in terms of the Cooperative Societies Act Chapter 24:05, drawing its membership from SMEs, traders, and professionals in Zimbabwe.
“We want to promote formalisation and empower SMEs to grow and contribute to the country’s economic development through the provision of affordable workspace, loans, and capacity building to SMEs,” secretary-general Last Matema told NewsDay Business.
He added that the cooperative society was also working with the Zimbabwe Chamber of SMEs to drive the growth of the informal sector through various government policies supporting the segment.
Keep Reading
- It’s time to retire, are you ready?
- ED challenger’s case raises eyebrows
- ED challenger’s case raises eyebrows
- Village Rhapsody: Zimbabwe needs proper e-waste management system
“We incorporated ourselves as a savings and credit cooperative society where one joins either to contribute to the development of a particular infrastructure project or use the property as a tenant,” Matema said.
“We want to promote formalisation, and we are empowered to do that under the Cooperative Societies Act.”
He said the cooperative society’s first project in Harare involves a building that has the capacity to house 200 micro- to small- and medium-sized enterprises (MSMEs).
Matema revealed that his organisation has acquired land in Guruve where it plans to develop a school, SME workspace, and shopping malls.
“These projects are expected to create opportunities for SMEs to access affordable workspace and grow their businesses,” he said.
Matema said one of the key challenges facing SMEs in Zimbabwe was access to finance, and that the cooperative society was working on a core banking system that would enable it to take deposits and provide loans.
“The cooperative society’s approach is holistic, focusing not only on providing financial support but also on capacity building,” Matema said.
“Through incubation hubs, matchmaking, and promoting intra-association trade, the society is creating a supportive ecosystem for SMEs to thrive.”
He added that the cooperative did matchmaking and promoted buying among members as a trade intra-association.
“This way, we can create a closed-loop economy that benefits our members and supports local economic growth,” Matema said.
According to IAPAZ, the cooperative society is also seeking partnerships with development financiers and banks with patient capital to strengthen its balance sheet and support infrastructure development.
“We need patient capital because infrastructure development requires patient capital,” Matema said.