Monday, June 24, 2024

Financing institutions are withholding this country’s developmental activities – Mbambiko

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THE Kitwe Chamber of Commerce Trade and Industry charges that calls for value addition to local products will remain unattainable as long as lending institutions refuse to
adjust their financing conditions.

Chamber president Emmanuel Mbambiko says because their high cost of borrowing, commercial banks are making it difficult for entrepreneurs to go into value addition

Mr Mambiko in an interview, Wednesday, noted that although the government has already provided a conducive environment
for doing business, the cost of financing from commercial banks however is unbearable.

”The financing institutions are the ones withholding the developmental activities in this country, they are too rigid and expensive, I don’t Know if it’s government borrowing that is making them\

remain ridiculously high to make government withdraw from that borrowing window, but they need to come on board otherwise they are not helping the country,” He said

He further accused commercial banks of having formed a cartel to deprive local entrepreneurs of funding by exaggerating their lending rates
which are pegged within on the same range for all banks.

Mr. Mbambiko noted that it was unfortunate that government cannot force banks to relax its lending rates in a liberated economy that
Zambia has adopted.

He expressed hope that the Central Bank will rise to the occasion and advise the commercial banks to relax their lending.

conditions to boost economic activities.

He however commended President Hakainde Hichilema for emphasizing on the need for Zambian entrepreneurs to add value to their product during the just ended
Trade Fair in Ndola.

Value addition to locally produced products will enable entrepreneurs and the country at large to increase the economic value of the local products.

During the just ended Trade Fair in Ndola, which was held under the theme: ‘Promoting Value Addition for Sustainable Growth’, President Hakainde Hichilema stressed on the need to add value to the local
products through processing of finished products.

The Mukula tree logs as one of the products that , President Hakainde cited , can be processed instead of exporting it raw when it can be processed and used to make good quality desks locally.

7 COMMENTS

  1. Banks only want transactions that favor them and want others to take risks. In Livingstone during a UN meeting, Guest of Honor then Dr. Edify Hamukale told off banks for retarding economic progress and investment by being risk averse. Even Felix mutati told the banks to be more supportive of SMEs but alas chiwamnina galu kuluma mbuzi koma mbuzi singalume gale. Shame!!!

  2. The moment Government will control its borrowing that’s when banks will go to SMEs crawling. At the moment banks are comfortable to lend to Boma and its workers. If Boma mops up all funds through Treasury Bills then there’s nothing left for SMEs. BoZ is also sleeping because some banks in fact employ predatory tactics. If you want to lose your property the most sure way of doing it is to borrow from those banks. There are also so many hidden costs. If you plan to borrow 100,000 then apply for 120,000 because the bank will finally give you 80,000 or less after deduction of hidden costs. All these happen right under the nose of BoZ, maybe balalyamo

  3. During PF you never talked about the banks lending money because the cash was freely flowing from government. Now you are stuck and there is no alternative want to blame banks. Banks are businesses that needs to balance risk and profitability, In Zambia the biggest draw back to credit is poor town planning. Poor town planning has massively affected the post office and the parcel business and I doubt if e-commerce will take off in a meaningful way to attract businesses like Amazon, eBay etc.

  4. This man clearly doesn’t know what he is talking about. He should have kept quiet. He is ignorant.

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