“Why are banks refusing to give us loans.
Even with an active account and orders, still they don’t want, funds not available.”

I got the above email from a reader of the SME Chat Column in the Standard last week.
It so happened that earlier in the week I spoke to some insiders in the banking world who advised that most Zimbabwean banks are stuck with poorly performing loans (roll-overs) and have no funds to give to new loan applicants.
So why should you smile if you can’t get a loan?
Because you are saving your business assets and your home. Hundreds of companies have gone under the hammer in the first half of this year for failing to pay bank borrowed funds.
Too many SMEs are rushing to borrow funds without re-assessing the viability of their businesses under the present exorbitant cost of funds (over 30% per annum).
Most have prsented excessively optimistic business projections with highly inflated cash flow projections. And the financiers knew it but they still gave them loans.
Financiers don’t care about the viability of your business. They care about their money. That’s way they always want collateral, sometimes worth several times the loan value.
The Bible says in Proverbs 22:7 “Borrow money and you are the lender’s slave.”
It’s up to entrepreneurs to avoid the money slavery trap.
If your product or service is good enough to satisfy a real needin the market there is no need for you to borrow money.
As much as you want to think your business will get off the ground or expand if only you had more cash available, it won’t.
The reality is that for most businesses, they don’t need more cash, they need more brains.
***I will continue this discussion with practical of growing your business while avoiding debt Wednesday. In the meantime let me know your thoughts here or at, you will find lots of entrepreneurial resources. Don’t forget the SME BusinessLink Networking Cocktail on Thursday 23 June, 5.30pm-7.30pm, and the Essential Finance for Entrepreneurs and Non-Financial Managers on Friday the 24th. You can call Christine on 0772 854 301 for details, or email



  1. Cephas Nhumba Says:

    Just read an article on business and loans and I was impressed. I am a business management student with the M S U . I found the article to be very real and challenging the way any aspiring entrepreneur should think.

  2. William Chanza Says:

    Sound advice indeed. People are chasing for loans without thinking of the consequences of their actions.

    Anyway I was looking to download the Entrepreneur’s Guide to Starting a Business in Zim. Please assist.

  3. Sir Macdonnald Says:

    Despite your carefull analysis of smes not needing any financing, i need a loan. I have a house as collateral, i need $15,000.

    Call me 0772 985 395

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