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THE Government has relaxed conditions for ailing firms wishing to access loans under the Distressed Industries and Marginalised Areas Fund (DIMAF), the secretary in the Ministry of Industry and Commerce, Ms Abigail Shonhiwa, has said. The Government in partnership with Old Mutual in 2011 set aside a $40 million fund to revive ailing companies in the country especially those in Bulawayo.
The money is being disbursed through CABS but there have been concerns that most firms who are in dire need of the funding are failing to access it as they do not meet the set criteria.
Ms Shonhiwa said the existing criteria had virtually excluded ailing companies from accessing the funding.
“The people who are administering that money are vetting companies that have the ability to pay back the loans,” she said.
“Most companies that are really distressed could not access the money because they were considered not able to pay back the loans.”
Ms Shonhiwa said to remedy the situation Government had set aside $5 million from the fund to be disbursed to those firms that could not access it due to the rigorous selection criteria.
She said they had also managed to negotiate the reduction of interest rates from 15 percent to 10 percent.
“Disbursement of the $5 million should start soon as we have already forwarded a list of approved companies to the Ministry of Finance,” she said.
The Government has implemented various measures to revive the fortunes of ailing industries in the country including setting up other credit lines like the ZETREF fund.
It has also crafted policies which include the Industrial Development Policy and the National Trade Policy to stimulate recovery of the manufacturing sector. – New Ziana
derick.khumalo