The Zimbabwe Microfinance Wholesale Facility (ZMWF) says it has disbursed $4 million to micro finance institutions for working capital purposes since January up from $1.3 million last year.
The ZMWF, whose objective is to provide affordable funding for on-lending to microfinance institutions (MFIs), commenced operations in 2012.
Fund manager Brian Zimunhu said that the facility was primarily involved in the provision of funding to institutions involved in micro-enterprise lending as opposed to consumer lending.
“We have disbursed $4 million from January to now and this brings the amount that we have disbursed since inception to $6.3 million,” Zimunhu said.
At its inception in 2012, the facility disbursed $1 million and a further $1.3 million in 2013.
Zimunhu said the huge jump in allocations was due to the huge appetite for funding as MFIs continued to re-apply for funding.
“The appetite for capital is insatiable but the capacity to manage the money is limited,” he said.
“The capacity requires a lot of nurturing.”
He said the fund had disbursed loans from a minimum of $15 000 to a maximum of $1 million and would grow its loan limits depending on the facility’s capitalisation levels.
“It is 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,” the fund manager said.
The facility, whose anchor donors are DFID, United Kingdom, Hivos, Danida and Germany’s GIZ, is extending loans to MFIs at an average cost of 11 percent per annum.
The fund commenced operations with a capital base of $3.2 million.
Zimunhu said the fund’s battle with non-performing loans was not as bad as that faced by commercial banking institutions.
“Our portfolio at risk is between eight and 10 percent,” he said.
“We have some clients struggling to pay but they are in the minority.”
According to the Reserve Bank, Zimbabwe has 156 MFIs but Zimunhu said the ZMWF was only catering for a small fraction involved in micro-enterprise lending.
The bulk of the micro finance houses were into consumer lending, he said, and had access to funding from a variety of sources which include the diaspora.-The Source
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