Small-scale finance for Seychellois micro-entrepreneurs
Seychelles has virtually no microfinance institutions in the classic sense: small loans come mainly from the Development Bank of Seychelles and its SME Scheme, from the Seychelles Credit Union and with support from the Enterprise Seychelles Agency.
An archipelago without an MFI network
Unlike West Africa, Seychelles has no network of microfinance savings and loan funds. Regulation treats microcredit as an ordinary lending activity with no specific licence, which explains why public institutions play such a central role in small-business finance.
The Development Bank of Seychelles SME Scheme
Among the five funds managed by the Development Bank of Seychelles is an SME Scheme aimed at small local businesses. The amounts, rates and security required are set by the DBS and reviewed periodically, with all figures expressed in rupees.
The Seychelles Credit Union for members
The Seychelles Credit Union grants small loans to members, often linked to their savings. Dressmakers, small caterers and taxi drivers find local financing there, provided they have built up regular savings with the union beforehand.
Support from the Enterprise Seychelles Agency
The Enterprise Seychelles Agency helps micro-entrepreneurs draw up a business plan and gain access to financing. A project prepared with its help generally gets a better reception from the DBS or the Credit Union when the application is assessed.
Business licence and going formal
Before funding an activity, the lender asks for the licence issued by the Seychelles Licensing Authority. Vendors at the Sir Selwyn Selwyn-Clarke market in Victoria and craftspeople on Praslin therefore need to regularise their status first.
Small-scale fishing and blue projects
A fisher who wants to replace an outboard motor can apply to the DBS's specialised fishing funds. These blue economy financing options are detailed in our guide to a business loan in Seychelles, with the conditions that apply.
E-money and small shops
Airtel Money, available since 2015, and Nebula FinTech's services let small traders take payments by phone. These tools improve the traceability of takings, which helps convince a lender, although they do not offer credit themselves.
Security demanded on small amounts
Even for a few tens of thousands of rupees, a guarantor, a pledge on equipment or a deposit is often required. Without a land title of their own, young entrepreneurs find it harder to access larger loans for their projects.
Unemployed and starting a self-employed venture
Someone with no income who launches an activity must first prove it is viable, and support from the Enterprise Seychelles Agency can help. Realistic options for this profile are set out in our guide to a loan for the unemployed in Seychelles.
Credit history and the SCIS
The DBS and the Credit Union both take part in the Seychelles Credit Information System. A small loan repaid on time builds a positive history, which later opens access to larger bank financing to grow the business further.
Zambia's microfinance model
In Zambia, an active microfinance sector offers group loans and digital credit. Our guide to microcredit in Zambia shows a model very different from the one in Seychelles, a gap explained largely by the size of each market.
Scams targeting small entrepreneurs
Facebook pages posing as international funds for small Seychelles businesses demand fees before paying anything out. No serious organisation asks you to pay in order to receive a loan or a grant, so treat any such request as fraud.
Putting together a small loan application in Seychelles
- Obtain a business licence from the Seychelles Licensing Authority and open a business bank account.
- Prepare a simple business plan, with help from the Enterprise Seychelles Agency if needed.
- Cost the equipment or stock to be financed precisely, using quotes from local suppliers.
- Submit the application to the DBS or the Credit Union with supporting documents and the proposed security.
- Keep regular accounts of takings to ease repayment and support a larger future loan.
What a small business loan costs in Seychelles
| Item | Level | What makes it vary |
|---|---|---|
| DBS SME Scheme rate | Set by the DBS | Amount, sector and term |
| Credit Union rate | Per the members' scale | Savings held and length of membership |
| Arrangement fee | Variable | Institution's policy |
| Business licence | Depends on category | Seychelles Licensing Authority scale |
| Security | Pledge or guarantor | Value of the financed equipment |
Documents for microfinance in Seychelles
- Seychelles national ID card
- Seychelles Licensing Authority business licence
- Business plan and cash-flow forecast
- Quotes for equipment or stock
- Bank or e-wallet statements
- Guarantor's undertaking where applicable
Why microcredit applications often fail
- Applying without a business licence, when the DBS and the Credit Union require a formal activity before granting any financing.
- Mixing personal and business takings in one account, which stops the analyst from assessing how profitable the activity really is.
- Paying fees to a so-called international fund on social media that promises unsecured loans to Seychellois micro-entrepreneurs.
- Underestimating tourism seasonality and planning the same repayments in the low season as in the high season.
Questions from Seychellois micro-entrepreneurs
Are there microfinance institutions in Seychelles?
Not in the sense of a network of licensed MFIs as in West Africa. Small business loans come mainly from the Development Bank of Seychelles, the Seychelles Credit Union and, for established customers, the commercial banks.
Do you need Seychelles nationality for DBS microcredit?
The DBS public funds mainly target citizens and businesses that are majority-owned by Seychellois. A foreign resident will more likely turn to a commercial bank with a strong application and adequate security.
Can microcredit fund a stall at the Victoria market?
Yes, if the activity is licensed and the project is properly costed. The lender will look at expected takings, the location and the applicant's experience before setting the amount and the term.
How long does it take to assess a microcredit application?
The time depends on the lender and on how complete the file is. A clear business plan, recent quotes and an up-to-date licence speed up the review, while one missing document can delay the decision by several weeks.