Ugandan MSMEs urged to ensure compliance
This call was made recently by Catherine Poran, the Chief Executive Director of Stanbic Business Incubator Limited, who emphasised that many Ugandan businesses fail due to non-compliance with legal guidelines
KAMPALA, November 23, 2024 – Micro, Small, and Medium Enterprises [ MSMEs ] in Uganda have been urged to adhere to the relevant regulations to ensure their businesses remain uninterrupted.
This call was made recently by Catherine Poran, the Chief Executive Director of Stanbic Business Incubator Limited, who emphasised that many Ugandan businesses fail due to non-compliance with legal guidelines.
“Many businesses fail because they are not compliant with the laws. When doing business, it’s crucial to follow the correct procedures. Compliance means running your business the right way, and that’s why, at the Stanbic Business Incubator, we provide skills to help your businesses thrive,” Poran stated.
She was speaking at a panel discussion organised by MSMEs Uganda at Hotel Africana in Kampala, as part of the events marking Global Entrepreneurship Week. This annual event celebrates entrepreneurs, innovators, and startups, aiming to remove barriers to entrepreneurship.
Poran also highlighted another challenge facing businesses to be limited access to markets. She explained that this is why the Stanbic Business Incubator actively engages with potential markets.
“We are fortunate to have our sister organization, Stanbic Bank, which works with clients to help suppliers access new markets,” she added.
In addition, Poran advised MSMEs to explore alternative ways of raising capital, aside from relying on bank loans, acknowledging the difficulty many enterprises face in accessing finances.
“There are multiple ways to raise funds. You don’t always need a loan. For a loan, you must be disciplined, but you can also explore grants. We are currently running a grant programme, but for success, you must have been operating for a while. You need to have been paying taxes, be formalised, and registered with the Uganda Registration Services Bureau,” she explained.
Poran also encouraged MSMEs to consider equity financing and remain open to investors who may want to invest in their businesses.
Christopher Kakande, a Partner at Kalinda & Associates, advised entrepreneurs to formalise their businesses and ensure timely tax remittance to avoid penalties.
“As business owners, for your business to survive and grow, you must accept and pay taxes. Many try to avoid taxes, but this only leads to denial. It’s important to recognise that the government is your business partner,” Kakande remarked.
He pointed out that infrastructure, security, and other public services are some of the ways the government supports businesses.
“You may think the government isn’t involved in your business, but the moment you accept to pay taxes, you will find peace of mind. However, if you continue to deny this responsibility, you risk accumulating penalties, which could eventually overwhelm your business,” Kakande warned.
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