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Oliver Kazunga Senior Business Reporter
THE Zimbabwe Microfinance Wholesale Facility (ZMWFT) has disbursed $4 million to microfinance institutions for working capital purposes since the beginning of the year up from $1.3 million in 2013.
The fund manager, Brian Zimunhu, said the increase in uptake of funds under the facility by microfinance institutions (MFIs) was due to an increased appetite for funding.
“The appetite for capital is huge while the capacity to manage the resources is limited. We’ve disbursed $4 million since January this year to October 2014,” he said.
ZMWFT was launched in 2012 to provide seed capital to businesses involved in primarily provision of on-lending services.
Since its formation the trust has disbursed $6,3 million with loan limits ranging from $15,000 to $1 million at an average cost of 11 percent per annum.
The loan limits are expected to grow depending on the facility’s capitalisation levels.
“It’s our policy that no MFI can borrow more than 20 percent of our capital. As we grow the capital base then we can also grow the loan limits,” said Zimunhu.
At its inception, ZMWFT commenced operations with a capital base of $3,2 million.
As of June 30, 2014, the Reserve Bank of Zimbabwe, in a Microfinance Industry report, noted that the microfinance sector continues to play a critical role in the provision of finance to households and Micro, Small and Medium Enterprises (MSMEs) in Zimbabwe as part of the broader perspective of building inclusive financial systems.
The central bank said MFIs total loans increased by 83,24 percent from $97,01 million as at June 30, 2013 to $177,7 million as at June 30, 2014.
“As at 30 June 2014, total loans in the sector constituted 4,67 percent of total banking sector loans of $3,81 million,” it said.
As at June 30, 2014, there were 130 registered (MFIs) under the supervision of the Reserve Bank.
“The number of licensed MFIs has been fluctuating as some institutions have not been able to renew their operating licences due to viability challenges emanating from high levels of delinquent loans,” said the monetary authorities.
Online Reporter