Going Against the Odds: Integrating Risk Capital and Advisory Services for Small and Medium Enterprises in Mozambique

This paper shares experiences and lessons from implementing an integrated risk capital and advisory project to create growth opportunities for small and medium enterprises in a post conflict environment.

The paper gives an overview of the implementation of the Mozambique SME Initiative (MSI), a five year program comprising of direct lending and advisory services for the poor. The program was launched in 2004 when Mozambique was emerging from a sixteen year civil war. Lessons from the implementation include:

• Start fundraising early, and give time for donors and investors to come on board;
• Continuity of staff is crucial to success of the program;
• Provide specific and customized advice to SMES;
• Simplify procedures and processes to suit direct SME investment;
• Help SMEs see value in advisory services so that they will be willing to pay;
• BDS providers need capacity building and motivating to work in post conflict environments.

The paper states that it is also important to consider exit and sustainability strategies to ensure that SMEs continue to benefit from the program after it has ended.