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.
Are ordinary people supposed to be benefitting from anything? I thought that that’s why they are ordinary because they are of no consequence? Do you want the loans to be distributed to the ordinary people? Foolish. Just stop pretending and tell these ordinary people to get on with their lives somehow and become less ordinary.
Do you want the loans to be distributed to the ordinary? Just tell them to work hard to become less ordinary.
Lungu was ordinary and a drunk now he reigns over you because he is a crook. The ordinary can follow the same path. It’s a jungle out there.
Another example is, can’t you see how England wants to win the World Cup at all cost? (which I know they will not) but they are trying by avoiding all the bigger fish. The ordinary can take a leaf, assuming they know who England and the World Cup are. If they do not they are waste of space.
This business of borrowing is NOT good. It starts from the very top of leadership, trickling down to Joe bloggs in Chimwemwe compound.
Loans are not the way forward. Try to live within your means. I mean who really cares if you are not driving the latest BMW or if you do not have mansions in rogue countries?
Let us get real and practical citizens please.
Let us grow our nation, not our debt.
IndigoTyrol – there is good debt and bad debt.
He’s actually right. Zambians are not benefiting from loans because finances meant for business tend to be spent on luxuries. I know of people who fly their mistresses to Dubai or South Africa on finances meant for business. You can’t get a loan to spend it on wine, clothes and plane tickets and expect to benefit from it. Wake up Zambians!
Banks need to do their due diligence…I mean they can not give loans to someone who has got no assets or is a brief case business. Moreover the cost of borrowing in this country is too high…you can not make a profit with those rates unless you are borrowing abroad like a lot of foreigners…imagine my British bank offering me a £50,000 at 18.9% APR compared to ZANACO offering you at 40%APR.
You don’t always need assets to borrow the project itself can be the asset, but true the cost of borrowing is ridiculous
The participation of SMEs in Zambia’s economy is small and can be enhanced with banks lending at low interest rates
Ba LT naimwe Is Mr Chisha different from Mr Mwanakatwe? Why are the two names being used interchangeably in the story?