The much awaited Zimbabwe Emerging Enterprises Market (ZEEM), a soon to be operational securities exchange platform targeting small and medium enterprises is finally gaining traction, three years after the idea was mooted, 263Chat Business can report.
The Zimbabwe Stock Exchange (ZSE) has since partnered a local finance solutions firm, GetBucks Microfinance Bank to expedite ZEEM operations.
The establishment of ZEEM has undergone major technical and legislative delays since 2016, despite its operating framework which include listing requirements having been already crafted.
The ZSE, Getbucks partnership will lay out supporting modalities for the operationalization of ZEEM.
“The Zimbabwe Stock Exchange Limited (“ZSE”) wishes to advise stakeholders on the signing of a Memorandum of Understanding (“MOU”) between the ZSE and GetBucks Microfinance Bank Limited (“GetBucks”). The partnership will entail the two parties working together towards operationalizing the Zimbabwe Emerging Enterprise Market (“ZEEM”),” ZSE CEO, Justin Bgoni said.
At first the ZEEM product will be offered through an Over –The-Counter platform targeted at offering working capital solutions for formalized small and medium businesses before ZSE facilitates and assist the businesses to list on the secondary bourse going forward.
GetBucks will then assist SMEs with training and other initiatives to educate on benefits of listing and meeting the requirements.
The initiative is informed by the fact that the country’s SMEs sector has recorded tremendous growth in business establishments in recent years, yet most of these enterprises are struggling to sustain the tight economic environment due to capital constraints.
ZEEM, will hence create a platform for trading securities and investing in SMEs, while demanding less stringent listing requirements compared to the much sophisticated ZSE.
As part of the requirements for ZEEM, SMEs will be required to have at least $250 000 but not exceeding $9.99 million in share capital, to provide audited financials for at least one financial period prior to listing, have a minimum of 50 public shareholders and also achieve at least 26% public shareholding and appoint a designated adviser.
Analysts have however, called for reconsideration of the minimum capitalization requirement of $ 250 000 which was reached at during the multi-currency system which has since been eroded by inflation since floating of the local currency in February this year.
The development comes at a time government and the ZSE are exploring various investment instruments on local capital markets with the proposed Commodities Exchange Market for local farmers expected to be a game changer.