Founder and Chief Executive Officer of McDan Group, Daniel Mckorley has urged start-up businesses to desist from securing loans from banks and other financial institutions to foot expenses of their infant businesses.
According to the business magnate, about 70% of small business which access credit facilities don’t survive. Additionally he says, banks loans are extremely unhealthy for start-up business as well as medium and small scale enterprises.
Speaking at a Start-up Investor Conference, Mr. Mckorley noted infant businesses will have to endure the pressure of paying back such heavy interest bank loans when secured.
“The banks are not the right place to go to when starting a business. When business have gotten to the stage where they make about 50% profit, then they can secure a loan. Even if you have business plan banks are not interested in giving loan. To survive as entrepreneur in this part on the world one has to be disciplined.”
Mr. Mckorley also observed that, aside the rigorous and frustrating process banks subject businesses to in the process of loan acquisition, many start-up businesses struggle to pay back the monies, failure for which their businesses collapse in the loan repayment process.
The Start-up Investor Conference, organised at Swiss Spirit Alisa hotel in Accra in by the Netherlands’ Embassy in Ghana and MBC Africa assembled various Start-up businesses and stakeholders. The program seeks to promote young businesses and address key hurdles for start-ups and early stage businesses in Ghana.
Speakers present spoke on the role of government in building the right ecosystem for young businesses to thrive as well as the role of local banks in financing early stage businesses in Ghana.