Finance: The lack of a policy or regulation in financing start up projects is limiting banks from funding projects, the Financial Institutions Association of Bhutan’s president, Kipchu Tshering, said during a panel discussion during the Global Entrepreneurship Week held in Thimphu.
Kipchu Tshering, who is the Chief Executive Officer of the Bhutan National Bank, said that there is no organisation structure to promote cottage, small and medium enterprises. “There is lack of infrastructure too.”
“As of today, entrepreneurs have to run from pillar to post to get infrastructure and funds for the projects,” he said, and added that financial institutions are willing to participate and share their resources but the economic affairs ministry needs to come up with a policy for venture capitalism.
Financial regulations at present prevent banks from equity participating in investment of more than 30 percent.
Kipchu Tshering said that the government’s scheme of providing incentives to organisations to employ youth is not a long-term solution.
It emerged that resource mobilisation is one of the most difficult component of start up projects.
An entrepreneur and Loden Foundation beneficiary, Tharchen, said entrepreneurs must develop a proper project through exhaustive research before rushing to seek funds.
“One has to do a lot of work before reaching the stage where you have to worry about funds,” he said. “Don’t do it for the sake to gain employment.”
Kipchu said that banks would not give loans if the project proposals are not convincing.
“We’ve hundreds seeking huge loans from which we can get big returns, of which an entrepreneur like you are a small segment. Why would we give you unless the project is really good,” he said.
Close to a hundred aspiring entrepreneurs took park in the panel discussion on ‘Access to Finance, Opportunities and Impediments’ on November 16.
Loden Foundation organised training on writing business proposals, basic book keeping, and resource mobilising, among others, to observe the Global Entrepreneurship Week that ended yesterday.
The week-long programme brought a platform for aspiring entrepreneurs to connect with like-minded individuals, potential collaborators and mentors. It is expected to introduce entrepreneurship concept to beginners, deliver ideas and skills to those who in process of developing their projects.