By Chimwemwe Mangazi:
One of the country’s microfinance institutions, Select Financial Services, has described the non-remittance by government of payments duly deducted from civil servants as a major challenge facing the business.
Without divulging how on much the government owes the business, Select Finance acting Chief Executive Officer, Kisa Kalolokesya, said the development has led to suspensions of disbursements resulting in stalling of housing projects as borrowers cannot access funds.
This came out when the institution engaged leaders of Teachers Union of Malawi (Tum) recently in Lilongwe on new products and initiatives to cement the partnership.
Kalolokesya added that the business is facing challenges due to high cost of funding resulting in low amounts of loans.
“We are trying to stay on top of business despite these challenges and we are introducing all current loan products to Tum members. But an additional cash back amount, calculated according to sliding scale, will be paid to the applicant in addition to the original approved loan amount,” Kalolokesya said.
Tum Secretary General, Charles Kumchenga, lauded for the initiative, stressing that it would excite members.