Call on MFIs to comply with law

Business Reporter
MICROFINANCE institutions have been cautioned to comply with the National Microfinance Act and desist from taking deposits from members of the public. Addressing Zimbabwe Association of Microfinance Institutions (ZAMFI) members at a workshop in the city last Friday, executive director Mr Godfrey Chitambo said it is important for the MFIs to comply with the law.
“Compliance with the Act benefits us as MFIs not the Reserve Bank of Zimbabwe or any other regulatory authority. It creates a good image for us and we gain the trust of our potential clients,” he said.

At a workshop organised by ZAMFI to review the National Microfinance policy, Mr Chitambo said comprehensive adoption of the Microfinance policy will help in the alleviation of poverty and stimulate economic growth.

“Comprehensive adoption of the policy by members and stakeholders will help to alleviate poverty and promote economic growth by creating an enabling environment for MFIs to blossom,” said Mr Chitambo.

He said the policy will give them guidelines on how they ought to operate and also spell out how the MFIs should relate with other financial institutions.

“This policy will help us in future by defining how we are going to relate with others and our operations. Even if we do not use it today, in future we should have the capacity to approach authorities to ask for resources and this will be possible if there is a clear policy,” he said.

He said the policy would serve as a roadmap and provide strategic direction for all key stakeholders operating in the microfinance sector in Zimbabwe.

Mr Chitambo called on commercial banks and building societies to provide funds for MFIs.
“Commercial banks and building societies must go downstream into microfinance either by wholesaling funds to MFIs or retailing to consumers of microfinance services,” he said.

Regional MFI co-ordinator Mr George Nhepera warned MFIs against engaging in non permissible activities.

“Do not engage in non permissible activities, if you are a lending MFI do just that and not end up taking deposits,” said Mr Nhepera.
He said MFIs should make sure that their operational licences must always apply for new licences two months before the expiry date to avoid inconvenience.