IDC study shows lack of capital funding for ICT

According to new research conducted by South Africa’s Industrial Development Corporation ( IDC) indicates that as Information Technology (IT) channel providers search for opportunities amid volatile credit and capital markets, the gap between customer IT financing requirements and channel partner capabilities continues to widen.

The study, conducted during February 2009, also produced a series of research findings that reinforced preconceived notions of how market volatility affects channel providers, as well as some research findings that IDC analysts said were surprising.

In a statement, the IDC said: “64 percent of large channel providers participating in the study reported that their customers have more interest in IT financing and leasing programs than 6 months ago. At the same time 40 percent of these same channel providers reported that they do not anticipate the need to introduce and educate their customers on the benefits of leasing and financing as a ways to procure needed IT resources.”

“Eleven percent of channel partners surveyed reported that they do not have access to capital to continue “business as usual.” When the findings are segmented to examine different sized resellers, nearly 20 percent resellers with annual revenues less than $5 million reported they had inadequate access to capital.”

The IDC, a state-owned entity, is tasked with innovation and development of the industrial sector in South Africa and the rest of the African continent.