The Bankers Association of Zambia (BAZ) has clarified that the COVID-19 stimulus package from the Bank of Zambia will still be subjected to interest rates or collateral for one to access from the banks.
BAZ Chief Executive Officer Leonard Mwanza however says Small and Medium Entrepreneurs are expected to access the funds at around 26 percent interest rate and not the market rate.
Mr. Mwanza says the COVID-19 stimulus package is not free money that is being given out without any interest.
He has further explained to ZNBC news in a telephone interview that the Central Bank has continued to release the funds to the banks and that it is an ongoing process.
Mr. Mwanza was reacting to an appeal by the Cleaning Association of Zambia who are in the SME category to Banks to reduce interest rates in view of covid-19.
Cleaning Association of Zambia President Lawrence Makumbi said most of his members’ businesses have been affected by COVID-19 and that the workforce has reduced.
Are you sure reporters?
will still be subjected to interest rates or collateral for one to access from the banks.
Do Interest rates substitute for collateral???
Yes, it should. Very good move, BoZ. People even misuse money with collateral and interest rates. Imagine wht they would fo to interest-free money!
Only lazy ones expect free things. Utilize the money wisely and you will be able to pay back and make profits. Reduce on drinking and useless things
So the government gives out funds, and then the banks still earn interest? That makes it a normal commercial loan. Fine with me, but then don’t let the government say they are helping out with the Covid pandemic – because they are not! It’s just the banks getting even richer than they already are.
Because commercial banks are expected to pay interest to Bank of Zambia.
Its sad that high interest rates are level on this package
This is useless, the UK is giving £50,000 loans at 2% interest, no collateral and you only pay back if your business survives Covid-19 so its free for all.
Patriotic this is the republic of Zambia. We are not breee-itch mate
Patriotic this is the republic of Zambia. We are not breee-itch mate. Kz
Precautions should be taken to stay safe