MFIs keen to upgrade

banked.

Commercial banks in the country have failed to fully capture the market especially in outlying areas of the country, leaving a void, which MFBs are expected to fill.
The central bank has set the minimum capital requirement for MFBs, which will only be licensed once the Microfinance Bill currently in Parliament has been passed into law, at US$5 million.

Zamfi board chairman Mr Clive Msipha told New Ziana that potential for MFBs in the country was “quite huge”.
“There has been keen interest within our membership to make that step up into MFBs. The potential for microfinance banks is quite huge,” he said.

Mr Msipha said experience from other countries had shown that the MFBs, which are deposit taking MFIs, had played an important role in ensuring that the majority of people had access to banking services.

Currently, MFIs in the country are only allowed to extend loans to their clients and not to take deposits.
Some MFIs were last year shut down after they took the law into their own hands and decided to take deposits.
Mr Msipha said MFBs had the advantage of being cheap to establish, unlike commercial banks. — New Ziana.