The African Development Bank (ADB) and Zambia National Commercial Bank (ZANACO) have signed a US$10 million credit line agreement meant to improve the financial status of the Small Medium Enterprises (SMEs) sector in Zambia.
Speaking during the signing ceremony in Lusaka yesterday, ADB Resident Representative Freddie Kwesiga called for enhanced private public partnership in the SME sector for the betterment of the country.
Mr. Kwesiga said this is because the SMEs sector plays an important role in stimulating economic growth of the country.
He however, noted that this can only be achieved through deepening financial and technical assistance for those that are already in or wishing to join the industry.
He said the improved financial support can enhance the capacity of local SMEs therefore making them ready to compete favourably even on the international market.
Mr. Kwesiga added that the loan, which will cover infrastructure development, good governance, agriculture and manufacturing sectors, is likely to benefit SMEs from both rural and urban areas.
He pointed out that there is also need for stakeholders in the country to address both the financial and non-financial requirements of the SMEs throughout the country.
Mr. Kwesiga further urged ZANACO bank to make the loan accessible to all the people wishing to invest in the SME sector and even those that already have established business.
And ZANACO Managing Director Mark Wiessing has disclosed that his bank currently has over 20,000 SME customers.
Mr. Wiessing said last year ZANACO’s loan book performed well hence benefiting clients despite the global economic crisis that hit many countries in the world.
He stressed that the bank’s decision to focus on SMEs and agriculture sectors when sourcing for loans with other cooperating partners was aimed at making these sectors contribute significantly to the revenue collection of the country.
He pointed out that it was the duty of the private sector to add value to the economy of the country in which they are operating.
Mr. Wiessing added that in an effort to promote foreign currency funding sources, the loan will be considered as part of the ZANACO’s strategy to encourage diversification in foreign currency funding.
He has since pledged his bank’s continued initiatives of encouraging more investment in the SME sector through developing programmes that will cater for SMEs in different businesses.
The loan between ADB and ZANACO will be repaid over a period of ten years.
ZANIS
yeah good news, but how many banks in zambia today have gotten money/funds in the name of SMEs and the so called SMEs never get to borrow these funds because of the stringent borrowing terms and conditions attached to these loans
second i m surprised that no one is commenting and even asking how they can access these funds as SMEs. anyway it seems only political issues attract commentators of all hues and shapes.
please zambians we need to pay attention to such news and flock to zanaco and find out how we can benefit as SMEs. let us not spend too much time reading political stories.
It would be interesting to know what interest they are paying the ADB, and what interest they will be charging the SME’s. If they follow the other banks it will not help anyone except themselves and Zambians will stay poor.