The Egyptian Association for Direct Investment held a seminar on direct investment funds in small and medium enterprises (SMEs) to review the successful experiences and the challenges facing the sector.
Chairperson of the association Abdallah El Ebiary said that the big deals always echoes louder and obtains media attention, but they are usually the easiest for direct investment funds, unlike SMEs investments, which require more effort and accuracy.
He stressed the need to finance SMEs by funding them or through the traditional banking finance.
El Ebiary urged the need to assess the experience of direct investment funds financing SMEs to highlight the importance of funding provided to them, especially as many SME owners are unaware of alternatives to the traditional banking finance. He explained that investment funds can help SMEs significantly, noting that governance can raise their value by 30%.
Monty Palmer, head of SEED Project, said that non-traditional finance will be more beneficial to SMEs than traditional finance, whether through partnerships, financial leasing, or risk capital.
He pointed out that SMEs are capable of realising higher growth rates than bigger companies, and this indicates that smaller investments in the sector can fuel high growth in the economy, create jobs, and power production sources.