Small enterprise finance – The engine for employment and income

Small enterprises play an important role in the economic and social development of a country.  They create jobs and make a significant contribution to a country's value added. For many people, setting up a small enterprise is their only chance for a secure livelihood. An important criterion in this respect is a financial sector that also takes account of the needs of small enterprises.

The SDC’s focus

The SDC supports institutions, initiatives and programmes that aim to offer a wide range of financial services for small enterprises (anywhere between 5 and 19 positions, depending on the country) on a cost-effective and economically sustainable basis.  To this end, the SDC's approaches include 'downscaling' and 'upgrading'.

  • Downscaling: Existing banks or other financial service providers, such as leasing companies, establish new business fields, product lines or sales channels that specialise in financial services for small enterprises.
  • Upgrading: Enabling existing microfinance institutions to address the requirements of small enterprises.

In addition, the SDC prioritises training for staff working in financial institutions and the provision of market information.

  • Training staff in financial institutions: The SDC promotes the enhancement of skills in financial institutions and the establishment of specialised training and consulting facilities.  Financial institutions must be enabled to offer financial services for small enterprises on a customer-oriented, profitable and competitive basis.
  • Market information: The SDC supports the development of methods and institutions that provide the financial market with information or services that improve decision-making and transparency, including credit and rating agencies, for example.

Background

Strong small enterprises are an important factor, not only for balanced economic growth, but also for social and political stability.  Yet small enterprises in developing and transition countries find it difficult to convince banks to take them seriously as clients. Most financial institutions are mainly interested in dealing with large companies.

The reason for this is, firstly, the relatively high costs entailed in granting loans, and, secondly, the risks to which lenders are exposed.  Financial institutions are often insufficiently informed with regard to the specific conditions prevailing in any given sector.  At the same time, many small enterprises fail to practise transparent accounting, have insufficient reserves and lack suitable collateral.  As a result, a comparatively detailed review is required before a loan can be granted.

Current challenges

Due to inadequate credit methodologies and in many cases a lack of interest by established financial institutes, small enterprises in many countries have only limited access to credit and other financial services.  To improve this situation, the requirements of small enterprises must be better addressed.  The range of products and services must be refined and made more flexible, appropriate credit methodologies must be developed and specific skills must be built up in financial institutions.  In addition to loans, small enterprises must be given access to other products and services, such as leasing, venture capital and payment methods.  Here, the key challenge to be tackled is the diversity of the small enterprise sector, both in terms of the size and type of businesses.  Finally, small enterprises must also use their own initiative to enhance their creditworthiness through transparent accounting, business plans and other measures.

Current projects

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Building Damage Assessment in Albania

01.04.2024 - 31.12.2027

The devastating earthquake in 2019 revealed that Albania has a weak policy and institutional framework and low public awareness on building damage assessment. The Swiss project will support Albania in strengthening its disaster risk management institutions at national and municipal level to provide sustainable and effective building damage assessment services, leading to safer living conditions and a more disaster resilient business environment.


8th Global Platform for Disaster Risk Reduction, Geneva, June 2025

01.03.2024 - 31.12.2025

The Global Platform for Disaster Risk Reduction is the most important international conference to discuss progress in the implementation of the Sendai Framework for DRR. The eighth session of the Global Platform will be hosted by Switzerland in Geneva in June 2025. It will review advances in the realisation of the calls to action made in 2023 by the United Nations General Assembly on the midterm review of the Sendai Framework and will be key for the identification and support of measures to accelerate DRR implementation and improve coherence with the Agenda 2030 and the Paris Agreement.


Appui aux Programmes PASEC et PACTE de la CONFEMEN (Conférence des Ministres de l’Education des Etats et Gouvernements de la Francophonie)

01.03.2024 - 28.02.2028

En soutenant le Programme d’Analyse des Systèmes Educatifs (PASEC) et le Programme d’Appui à la Transformation de l’Education (PACTE) de la Conférence des Ministres de l’Education de la Francophonie (CONFEMEN), la Suisse contribue au renforcement de l’accès et de la qualité de l’éducation dans ses pays prioritaires en Afrique de l’Ouest. Des analyses approfondies des systèmes éducatifs sont réalisées, et les résultats permettent d’orienter les politiques éducatives pour une efficacité accrue.


Addressing Climate and El Niño-related Risks in Southeast Asia

01.02.2024 - 31.07.2025

Through an innovative partnership with the Asian Disaster Preparedness Centre (ADPC) and Geoneon, the SDC will support the creation of high-quality geospatial data products to support riskinformed and climate-smart decision-making in development cooperation and DRM in priority subnational areas in Lao PDR and Indonesia, contributing to and complementing efforts under the SERVIR Southeast Asia project implemented by ADPC and supported by USAID and NASA.


UNHCR Digital Hub of Treasury Solutions (DHoTS)

01.02.2024 - 31.01.2026

Switzerland supports UNHCR’s Digital Hub of Treasury Solutions to create a UN Center of Excellence (CoE) in Geneva. It will facilitate the UN System’s and its partners’ access to global financial ecosystems and markets. It will trigger collaboration opportunities for advancing new cutting-edge capabilities and technologies, support preparedness and readiness in humanitarian emergencies for the delivery of aid assistance and financial inclusion and reduce financial transaction costs.


Climate & Socially Resilient Livelihoods’ Support (CSRLS)

01.02.2024 - 30.04.2028

The climatic challenges exacerbate Afghanistan's already fragile socio-economic condition. The project by the Afghan NGO, The Liaison Office, aims to sustainably improve lives and livelihoods of the poorest households in selected provinces by strengthening the natural resource base, climate change resilient and diversified livelihoods, relationships within and between communities, as well as joint climate action.


Supporting Anticorruption and Asset Recovery through the United Nations Office on Drugs and Crime and the UNCAC Coalition

01.01.2024 - 31.12.2024

Switzerland has a fundamental interest in preventing corruption so that resources in partner countries flow in public services and sustainable development, and stolen assets are not deposited in Swiss financial institutions. Supporting the effective implementation of the United Nations Convention Against Corruption (UNCAC) including a multilateral dialogue platform on asset return will ultimately lead to increased resources for the implementation of the Sustainable Development Goals.


UNICEF, EMOPS Geneva, Core Contribution 2024-2025

01.01.2024 - 31.12.2025

The Office of Emergency Programmes (EMOPS) ensures that the United Nations Children’s Fund’s (UNICEF) role in complex emergencies is clearly defined, the organization properly equipped and prepared to deliver its mandate to support the needs of children. SDC’s support to EMOPS in Geneva enables UNICEF to lead inter-agency humanitarian coordination, response and standard setting in Water and Sanitation (WASH), Education, Nutrition and Child Protection.


Safeguard Young People (SYP) - Tanzania

Safeguard Young People Programme

01.01.2024 - 31.12.2026

With 62% of its population below 25 years, the Safeguard Young People (SYP) programme supports Tanzania’s demographic dividend. The project advances young people’s sexual and reproductive health and rights (SRHR) through a gender-responsive and inclusive policy environment, empowered youth who make informed decisions, and responsive health and education systems. SYP builds on 10 years of regional experience and UNFPA’s expertise.


Contribution to Medicus Mundi Switzerland (MMS) Network

01.01.2024 - 31.12.2027

Medicus Mundi Switzerland is a Network of 49 Swiss non-governmental organisations, foundations and scientific institutions involved in health advocacy at global level and health programmes in lowand middle-income countries. Taking a multisectoral approach and fostering open dialogue with relevant actors, decision-makers and the broader public, the Network facilitates the exchange of knowledge and experience and contributes to finding solutions to global health challenges.


CABI PlantwisePlus

01.01.2024 - 31.12.2027

PlantwisePlus is a global programme that is supporting countries and farmers to predict, prevent and prepare themselves for plant health threats in a changing climate. This will allow farmers to reduce their crop losses and produce more and safer food using agroecological and climate-smart practices that safeguard human health and biodiversity. The programme is implemented by CABI, a leading intergovernmental research and development organization in plant health, with research facilities in Switzerland.


SUD, OCHA: Sudan Humanitarian Fund 2024

01.01.2024 - 31.12.2024

The SHF is a country-based pooled fund that contributes to saving lives and protecting people in need by strengthening a coordinated and principled humanitarian response. It enables humanitarian actors to respond early and fast to humanitarian needs set out in the Humanitarian Response Plan (HRP) and to critical emergencies. All interventions are in line with the Minimum Operating Standards approved by the Humanitarian Country Team.

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