The Top 100 Survey Report on Small and Medium Enterprises (SMEs) was released on Thursday showing that the majority of companies in this category are still overly dependent on borrowed capital from banks.

The survey conducted by KPMG in conjunction with the Nation Media Group (NMG) indicates that because of this weakness where many enterprises depend on borrowed money, it is hard for most of them to develop faster while many fail to pay back in time which leads to their closure.

This has been noted by Benson Mwesigwa, an Associate Director at KPMG in Kampala noting that other big challenges failing SMEs include; the high taxes, tight competition and the high cost of production.

The findings further indicate that the high interest rate imposed on borrowed funds hinders expansion in capital for business operations which must be solved by the key players looking at expanding the economy.

On the other hand, Mwesigwa was however happy with the promising indicators from the building and construction sector which grew by 20%.

This year’s survey ran under the theme; “Empowering SMEs for a Monetized Uganda: Catalyzing Growth through Innovation, Sustainability and Market Access”.

By Gideon Peter Ssebulime

28 Nov 2024

END