SME Financial Inclusivity for Sustainable Entrepreneurship in Namibia During COVID-19

Abstract

The general reduction in the supply of labor, disruptions of supply chains, sudden loss of demand, and revenue by COVID-19 pandemic have negatively affected SMEs leading to their inability to operate normally causing liquidity constraints. Presumably, financial systems that reduce information asymmetry, transaction costs, ease external financial constraints, moderate market frictions, and ameliorate structural impediments limiting entrepreneurs and economic agents are instrumental. This chapter adopts an interpretive research perspective mainly employing documentary and secondary data analysis to explore descriptively the state of financial inclusivity and sustainable entrepreneurship in Namibia. Financial inclusivity explains entrepreneurship resilience through reduction of credit constraints embedded in irrecoverable start-up costs, limits operational innovations, hinders building production facilities and constructing distribution networks. Adopting SMEs' financial health framework, this study concludes that a multi-sectoral approach to SMEs' financial inclusivity is promising.