The recent 'Ethnic Minority Businesses and Access to Finance' report released by the Department for Communities and Local Government highlights some of the challenges faced by aspiring entrepreneurs from ethnic minorities when seeking financial support to start up a business. The report states that ethnic minority groups have significant aspirations to launch businesses - especially Black African (35%) and Black Caribbean (28%) groups. This is compared to a figure of just 10% among the White British segment. However, there seems to be a mismatch between aspiration and reality as the actual start-up rates among these minority communities remain low.
I welcome this report and the commitments made by the British Bankers' Association (BBA) as part of it, for example, hosting a series of road-show events on accessing finance and visiting areas across the country - including Norwich, Birmingham and Glasgow - which have a high ethnic minority population in order to raise awareness, understanding and confidence about accessing finance.
Also, further research by the BBA into ethnic minorities' experiences of and challenges in accessing finance can only help to drive forward the success of small businesses from all sections of our society, which is vital if entrepreneurship is to be an option for all.
Access to finance is, however, just one challenge that ethnic minority businesses - and indeed many small businesses - in the UK need to overcome. At Youth Business International (YBI), providing access to finance forms only one tier of our service-offering - our others being training and mentoring. We need a holistic approach to tackle the low start-up rates amongst some communities, delving deeper into the wider challenges that ethnic minorities face when embarking on start-up enterprise ventures. As part of this, I believe that the UK should look at what can be learned from the experiences of entrepreneurs in other parts of the world.
Karma Yonten from Bhutan is an example of an entrepreneur for whom finance wasn't the only barrier towards starting up a business. Karma runs Greener Way, Bhutan's first official waste management and recycling business which tackles not only the ever-growing problem of waste, but also the environmental and health problems associated with it, while simultaneously educating the Bhutanese people about recycling.
Although Karma's business idea sounds commendable when considering the waste-management market in Britain, it was controversial for Bhutan. Dealing with waste is an issue that was previously neglected and often ignored. Furthermore, working with waste is seen as an undesirable profession, which meant that Karma initially faced a great deal of opposition from his family and social circle. But he had a vision, and was determined to run his own business and serve his community despite these cultural concerns.
Youth Business International gave him the financial and mentoring help he needed. Now, tonnes of waste are being managed and disposed of; Greener Way is recognised as a pioneering business; and Karma's passion and courage have led to nationwide appreciation of what he has achieved.
Nimali Gunawardana from Sri Lanka is another example of an entrepreneur for whom finance wasn't the only barrier to success. After coming from an underprivileged background Nimali fought against the traditional expectations of a woman and launched Nimali Chips and Fibre Mill. The company produces coconut husk chips and coir which are exported to Canada, UK and Germany and used in agriculture and to purify water.
At the age of only 25, she has turned the tables on what is seen as the traditional and expected role of a woman in Sri Lanka. She has funded her own education and even attended the International Labour Organisation's Generate Your Business scheme to further her skills in entrepreneurship. She now supports her family and is the main breadwinner. Furthermore, her husband has given up his job to work for her - something which is very rare in Sri Lankan culture.
Stories like Karma's and Nimali's illustrate that the challenges faced by start-up entrepreneurs are not just about money. Their journeys to success - incorporating training, mentoring support and access to finance - should serve as important "how-to" guides for those in the UK who are trumpeting the importance of entrepreneurship and seeking ways to translate minority groups' start-up aspirations into reality. Only then can entrepreneurial hopes turn into real business success and economic growth.
YBI will be honouring Karma and Nimali at the upcoming global Young Entrepreneur Awards which is part of YBI's Global Youth Entrepreneurship Summit. The Summit - supported by Accenture, Barclays and BG Group - is taking place in London between 9th and 12th September.