Chronicle Editor
Zvamaida Murwira, Harare Bureau
Farmers should be able to use their livestock as collateral for bank loans from this coming summer cropping season under new arrangements now being organised by the Government.
This would in addition to the 99 year land leases, Permanent Secretary for Lands, Agriculture, Fisheries, Water, Climate and Rural Development Dr John Basera told a Star FM radio programme “Muriro on Monday”.
“We have not lost hope or we have not lost it outright. We are finalising the bankability of 99 year leases so we have some financial institutions, for example AFC, accepting 99 year leases, All the same we are in conversation with Bankers Association of Zimbabwe, Law Society of Zimbabwe and other institutions so that we make sure that our 99 year leases are bankable or are acceptable by the majority of the banks.
“We are almost finalising the same. The question of whole Government approach we are working with different and several Ministries and departments, Attorney General’s Office, Reserve Bank of Zimbabwe, Ministry of Justice, Legal and Parliamentary Affairs and of Finance and Investment Promotion so that we see to it that our 99 year leases are acceptable to most of the banks in the country,” said Dr Basera.
“However as an interim measure I am sure you are aware that there was a big pronouncement to have livestock as bankable and collateral. We are finalising the same. We are in conversation with RBZ so that we see to it that this season livestock can be bankable. At the moment livestock is only used for beef and also used to pay lobola and kuripa.
But it is not bankable yet. It is a biological asset which we need to tap into so that we can create a collateral out of it. So imagine we have a national herd of 5,6million cattle in the country maybe at an estimated value of US$400 per beast that is almost US$2 billion to US$3 billion. So we are finalising the bankability of livestock so that they can be used as collateral.”
The RBZ launched an online collateral registry for movable property with appropriate regulations in a bid to promote access to credit.
The collateral registry, a record keeping system for the existence of security, is a publicly available database of interests or ownership of movable assets, and enables borrowers to prove their creditworthiness and potential lenders to determine a borrower’s credit suitability measured against their collateral.
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