Trade-related financial services - ITC

For most SMEs, lack of access to early stage funding is the major barrier to success. Local capital markets usually focus on larger businesses, while investors’ capital is primarily available to more mature companies. The unmet financing needs are estimated to be between $900 billion and $1.1 trillion.

High administrative costs and collateral requirements as well as a lack of experience within financial institutions are among the main reasons that prevent SMEs from raising funds from the formal financial sector. No clear understanding of banking lending requirements, weak business and management skills, and opacity in financial statements make SMEs risky and thus less attractive to investors.

The ITC Access to Finance (A2F) approach provides valuable financial knowledge for SMEs to succeed in raising capital, and for financial institutions to adapt their products and terms to meet SMEs’ needs.

ITC’s approach is comprehensive and includes services to:

• SMEs: A2F improves SMEs’ financial management and business planning skills to increase their bankability by easing their access to capital. This is done through in-depth training  and step-by-step coaching solutions;
• Financial institutions: A2F empowers financial institutions with training, workshops, and software solutions to assess loan applications and better meet SMEs’ demands;
• Financial management counsellors: A2F strengthens, trains, and broadens its network of local financial management counsellors to guarantee countries’ ownership and services sustainability through TISIs; and
• Development financial institutions: when applicable, ITC mobilizes credit guarantee schemes, credit lines, and other innovative financing solutions with financing partners, such as development finance institutions.

ITC A2F has implemented more than 20 projects in 17 countries across Africa, Asia and the Pacific, in several value chains and sectors including agriculture, building and construction, livestock, information technology and information technology-enabled services.