Meeting of Finance Working Groups in Seychelles: |14 March 2017

SMEs’ role in economic development highlighted

Two international Finance Working Groups are this week meeting in Seychelles. They are the Small and Medium Enterprise Finance Working Group and the Empowerment and Market Conduct Working Group. Both groups fall under the umbrella of an international alliance known as the Alliance for Financial Inclusion (AFI).

Financial inclusion or inclusive financing which is defined as the delivery of financial services at affordable costs to disadvantaged and low-income segments of society, is one of the topics to be discussed at the meetings which are going on simultaneously at the Savoy Resort and Spa at Beau Vallon. Others will include the empowerment of Micro, Small and Medium Enterprises (MSME) and their protection as consumers, financial training, financial literacy; as well as MSME financing.  The Central Bank of Seychelles (CBS) which is hosting the meetings for the first time will have the opportunity to present the state of financial inclusion in Seychelles.

The Minister for Employment Wallace was the guest of honour at the opening ceremony yesterday morning.

Addressing the more than hundred delegates from fifty countries, CBS governor Caroline Abel remarked that SMEs which are considered as the drive to creating local demand and consumption play a critical role in Seychelles’ economic development. She added that as SME related matters are consequently high on the government agenda, the latter is in coordination with CBS closely working with commercial banks to in line with the risks associated with SME finance, come up with a strategy for SME landing.

Miss Abel provided a background of initiatives to develop the financial sector during recent years. Among others, these have included: The introduction of the Immediate Transfer Service (CBSITS) which creates an interbank platform for payment transactions; the Electronic Cheque Clearing System (ECC) allowing same day clearing via electronic exchange; the Seychelles Electronic Funds Transfer (SEFT) for interbank transactions; implementation of the electronic payment gateway for payment of government services; and the licensing of the first mobile payment service provider.

She however remarked that albeit all the progress made, there are important milestones that remain to be achieved in order to develop the sector. This is why she said, government has approved the Financial Sector Development Implementation Plan which will help strengthen the sector’s legal framework including the supervision of non-bank financial institutions, develop a national payment system, develop capital markets and also improve access to SME credit.

On this last note, the CBS Governor noted that as a survey conducted last year has shown gaps like lack of entrepreneurial information and skills, there is a real need for financial education and empowerment.

“Financially literate and empowered consumers interact more effectively and assertively with financial service providers, ultimately leading to attaining their financial objectives. Essentially, consumer empowerment is instrumental in supporting financial inclusion policies. While it is important for consumers to assume the responsibility of acquiring necessary financial knowledge and skills, it is important that authorities and financial institutions devote resources and work towards establishing mechanisms that support financial consumer empowerment”, Miss Abel stressed.