adminPatrick Chitumba, Midlands Bureau Chief
MICROFINANCE lender, Lic Finance (Private) Limited has opened a new branch in Gweru and plans to reach 100 percent loan book growth from $500 000 to $1 million by year end.
Lic Finance offers salary-based loans to civil servants and small to medium enterprises (SMEs) at nine percent per month interest rate.
Managing director, Mr Lican Mlambo, told Business Chronicle yesterday that the opening of the Gweru branch was also part of the company’s growth strategy as they plan to open other branches in Chinhoyi, Bindura and Bulawayo.
“We have opened the Gweru branch in line with our growth strategy. We envisage to have opened three branches in the first quarter of 2017. Areas like Nyanga and Mutasa North will follow in the second quarter whilst agencies will also be opening in remote areas later gravitating to branch status by the third quarter of 2018,” he said. “Lic Finance has grown from strength to strength inaugurating its first branch in Harare in July last year and in no time has established branches in Masvingo, Mutare, Chitungwiza, Chiredzi and Gweru.”
Mr Mlambo said an exciting package was on the cards for civil servants as the finance company looks forward to partnering with one leading chain store for furniture and grocery items.
He said his firm released over $300 000 to the market last year, which has grown by around seven percent since it opened doors barely two year ago. “This is our way of growing the SME sector and assist civil servants who do not have access to financing from big banks,” he said.
Last year, the Reserve Bank of Zimbabwe capped interest rates for microfinance institutions at 10 percent per month effective October 1, 2016. Some MFIs had been charging interest rates as high as up to 20 percent per month, stifling access to funding by SMEs and traders.
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