Finance expert says banks should facilitate loans for promising entrepreneurial projects

AMMAN — Banks should provide more support to entrepreneurial projects by having their experts evaluate innovative business ideas and fund those found to be the most feasible without requesting the usual loan guarantees from entrepreneurs, according to a banking expert. 

“Most entrepreneurs do not have bank assets or records, which are required for loans,” Mefleh Aqel said in a lecture earlier this week on the obstacles facing funding for entrepreneurs.

Over 60 per cent of entrepreneurs worldwide face difficulties in getting financing for their projects, Aqel said, adding that many institutions that claim to offer funds for entrepreneurial projects in practice do not.

He noted that poor funding is among the main reasons behind the failure of entrepreneurs, as around 40 per cent of their projects do not take off, while up to 80 per cent of them do not generate the expected revenues.

Aqel urged the government to allocate a portion of tax deductions to finance entrepreneurs’ projects.

He noted that most entrepreneurs worldwide are in their forties, and around 70 per cent of them are not married, but — most importantly — over 70 per cent of them belong to the middle class.

“A decrease in job opportunities usually boosts entrepreneurial projects as job seekers find themselves forced to make ends meet,” Aqel said at the lecture, organised by the Young Entrepreneurs Association and the Friedrich Naumann Foundation for Liberty.

Entrepreneurs also face difficulties in understanding legal information and dealing with the financial aspect of their projects, the expert noted, adding that many are not capable of describing their projects to others in one or two minutes.