Govt backs microfinance drive to expand low-income lending

Source: Govt backs microfinance drive to expand low-income lending – herald

Trust Freddy-Herald Correspondent

THE country’s informal sector and civil service received a major boost on Friday following the official launch of Talk and Pay Microfinance, a facility expected to widen credit access to small businesses and the country’s uniformed forces.

The financial institution, which is a subsidiary of the Prevail Group of Companies, was officially commissioned by Defence Minister, Oppah Muchinguri-Kashiri.

In her keynote address, Minister Muchinguri-Kashiri stated that the deployment of private capital into low-income credit markets is a strong vote of confidence in Zimbabwe’s economic trajectory and the national Vision 2030 targets.

“Your decision to launch and introduce this product is a very strong statement of the confidence that you place in Zimbabwe’s economy and Vision 2030 in particular,” she said.

The Minister commended the parent company, Prevail Group of Companies, for its continued partnership with the Second Republic across critical socio-economic projects.

“We commend Prevail Group of Companies for their unwavering commitment to contributing to our national development agenda. The group has expanded beyond commercial enterprise.

“Its involvement in the Presidential Borehole Drilling Scheme, Village Business Units, the Presidential Hospitals Rehabilitation Programme and the War Veterans Housing Scheme is a clear demonstration of alignment with His Excellency’s all-inclusive social development agenda,” she said.

The Government, Minister Muchinguri-Kashiri said, is backing low-barrier private lending as a critical tool to bypass conservative banking systems.

“It is in this regard that NDS2 explicitly directed the financial sector to bridge these gaps. Today, we commend Prevail Group for its newly established Talk and Pay Microfinance institution,” she said.

The newly deployed facility will issue micro-loans starting from US$50 to capitalise Micro, Small and Medium Enterprises (MSMEs) — a sector that currently generates over 60 percent of Zimbabwe’s Gross Domestic Product (GDP) and supports an estimated 4,5 million livelihoods.

“What struck me most about this product is its purposeful simplicity,” the Minister added.

“We often speak of financial inclusion in broad terms. Talk and Pay Microfinance has made it specific, practical and affordable. The loan facilities are from as low as US$50, which is within the reach of our hard-working micro-enterprises, the vendors and the backyard businesses.”

She also added that broadening credit lines for the security sector is a strategic necessity to guarantee domestic stability.

“As the Minister of Defence, I was glad to learn that men and women in the security sector are set to benefit from this loan facility,” she said.

“Many a times, especially this special sector is excluded from mainstream financial products. I was also equally delighted to learn that Talk and Pay Microfinance is specifically targeting women-led businesses.”

Minister Muchinguri-Kashiri also lauded President Mnangagwa for deliberately restructuring the domestic economic environment to allow privately owned businesses to flourish.

Prevail Group chairperson Dr Paul Tungwarara confirmed that President Mnangagwa inspired the creation of Talk and Pay Microfinance, adding that the firm’s credit models are structured to align with rural industrialisation.

“When we came up with this idea, we were inspired by the President’s mantra of leaving no one and no place behind. We looked at what the President has done so far; for example, we have the Village Business Units in rural areas.

“These are the people who deserve capital for their projects, which transform their lives. So, in terms of the support we are providing, we are looking at all spheres of society, from small-scale farmers to vendors, civil servants and everyone who needs support.”

Ministers Tatenda Mavetera (ICT, Postal and Courier Services), Charles Tawengwa (Harare Metropolitan Province) and Deputy Minister Mercy Dinha (Public Service, Labour and Social Welfare) were among the dignitaries at the event.

At the event, Dr Tungwarara donated 30 tonnes of rice and another 30 tonnes of cooking oil for Minister Muchinguri-Kashiri to hand over to the armed forces.

The facility is now fully operational and accessible to MSMEs, civil servants, private sector employees and members of the uniformed forces.