The Zambia Credit Guarantee Scheme says ordinary Zambians and Small and Medium Enterprises are not benefiting from available loans in the country.
Board Chairperson of the Credit Guarantee Scheme Chisha Mwanakatwe says this is despite Government embarking on the financial inclusion policy.
ZANIS reports that Mr Mwanakatwe said about 85 percent of the total country loan portfolio is tilted towards larger companies while small traders and small and medium enterprises struggle to access the remaining 15 percent.
Mr Chisha said the unbalanced distribution of capital has had a negative contribution towards unemployment levels, high poverty levels and escalating crime in the country.
“There is need to improve access to loans for individuals and communities in order for them to benefit from business opportunities and contribute to the country’s economic development, “he said.
Mr Chisha said the ability of Micro, Small and Medium Enterprises to develop, grow, sustain and strengthen them is dependent on them accessing and managing finances.
Mr Chisha stated that his organisation will work towards supporting the development and empowerment of MSMEs by increasing their access to affordable financing from lending institutions.
And 5.2 ZCGS Chief Executive Officer Francis Musonda said ordinary Zambians without collateral now have an opportunity to borrow money and invest in various business opportunities in order to improve their welfare.
Mr Musonda his organisation has developed an initiative that will see the Zambia Credit Guarantee Scheme provide partial guarantee of 50 per cent of loans for MSMEs in order to help them access loans from the market.
He said the initiative is intended for traders and enterprises that have been marginalised in accessing finances for growing their businesses.
He said the Credit Guarantee Scheme will be engaging the business community and financial institutions across the country on the benefits of the risk sharing mechanism in order to increase financial inclusion and promoting financial sector development in the country.