• Feature
• Finance

Benefits Of SMEDAN Registration To SMEs In Nigeria

by Alara Charis

November 10, 2020 5

In this post, we will discuss the benefits of SMEDAN registration to SMEs in Nigeria. The Small & Medium Enterprises Development Agency of Nigeria (SMEDAN) came into existence to aid MSMEs’ development. Since its inception, the body has achieved and still achieving several objectives within the Nigerian business sector. 

To carry out these objectives, the SMEDAN MSME Registration Program was established. The purpose of this program is to compute a database of all MSMEs in operation within the country.

Being a part of this registration process is of great benefit to businesses across the country. The term business here is not limited to a particular sector; it comprises businesses across all sectors.

However, you should meet specific criteria for registration as SMEs in Africa, based in Nigeria.

Who is eligible for SMEDAN registration in Nigeria?

Any business that falls under the category of MSMEs – Micro, Small, and Medium Enterprises is eligible to register. To further spell it out, MSMEs include any business that employs 250 employees or less.

MSMEs comprises of three business categories, which are:

• Micro Enterprise: Micro-enterprises employ a minimum of 1 employee and a maximum of 9 employees.

• Small Enterprise: Employs a minimum of 10 employees and a maximum of 49 employees.

• Medium Enterprise: Employs a minimum of 50 employees and a maximum of 2450

If your business falls into any of these sectors, you will be very much eligible to register your business. Now let’s look at the benefits of SMEDAN registration.

What are the benefits of SMEDAN registration?

If you’re still in doubt about registering your business, you shouldn’t be. Instead, you should be more worried about not registering. Missing out on registration will put your business at a significant disadvantage, which is a luxury you really can’t afford as a business owner who’s out for growth.

Let’s take a look at what you stand to benefit by registering your business.

Access to Business Insurance

Running SMEs in Africa can be quite daunting; from seeking funds to employing the right people and more. It doesn’t end there; there is also the risk factor of losing your business capital, profit, and even interest.

However, you can avoid all these with ‘Business Insurance.’ Business Insurance is an insurance type established to protect businesses from unforeseen losses that may arise in the course of the business.’

Having established that, one of the benefits of SMEDAN registration for your business is that it grants you access to business insurance. This way, you are assured that your business is in safe hands regardless of future occurrence.

Below is a list of various types of business insurance you will have access to as an SME in Africa:

• Business property insurance
• General liability insurance
• Workers compensation insurance
• Professional liability insurance
• Employment practices liability
• Directors and officer’s liability insurance

Mentoring

Though this is an unpopular opinion, it is one of the most important benefits of SMEDAN registration. Being an entrepreneur is not all there is to owning SMEs in Africa; you have to put in extra work at self-development and increasing your knowledge in your business field, registering with SMEDAN grants you access to mentorship. Professionals in the field handle the mentorship sessions, so you are sure to get nothing but the best piece of information to take your business to the next level.

With mentoring, you get training in the following areas:

• Setting up your books correctly.
• Sourcing for raw materials.
• Improving the products and services

• Solving complex problems.
• Data collection and analysis.
• Innovation and creativity in business.
• Collaborating and working with a team.
• Putting social media to practical use for your business. Etc.

The list is endless, but undergoing this training will be of great relevance to your business. The overall purpose of this mentorship process is to foster your career development as a business owner.

SMEDAN Unique Identification Number & Digital Certificate

With your certificate, you can easily apply for loans and support funds both within and outside the country. It also grants you access to funding from the government and private sector. Having access to these funding opportunities increases your chances of achieving your business goals and taking it to the next level.  

Access to Financial Services

SMEs in Africa need funds to thrive, and one way to access these funds is by applying for loans. To access loans from financial institutions, business owners need to have met some criteria depending on the funding type.

This process is more painless once you have your registration number. Another benefit you enjoy is that funding can come from either government or private organisations. It takes you past the hassles other non-registered business owners have to go through and makes the process way more accessible.

Once your business is registered, you get a conditional grant. This funding is from public funds, and as a result, you must put it to fair use. 

Selection Criteria for Conditional Grant

• You must own a registered business.
• The enterprise should have at least one staff – apart from the business owner.
• There should be a strong desire and commitment to grow your business.
• Meet up with the deadline for application submission.
• Meet up with basic requirements such as address proof and a personal means of identification.
• Business must have a progressive economic potential.

Having established the benefits of SMEDAN registration to SMEs in Nigeria, it is an opportunity you should seize. Achieve your business goals and take it to the next level by getting it registered.