Cheaper export finance at FMB
First Merchant Bank (FMB) says it has a cheaper line of credit from the European Investment Bank (EIB) for export oriented businesses to help them avert high lending rates prevailing in the country.
FMB’s newly appointed group general manager, Philip Madinga, told The Business Times in an exclusive interview in Blantyre on Tuesday that the bank negotiated for the facility as part of its strategy of supporting businesses in Malawi achieve their objectives even amidst economic challenges in the country.
“We would like to encourage those customers that export to talk to us to access this cheaper funding line,” said Madinga.
He said FMB is committed to support the National Export Agenda through provision of innovative solutions to all its clients.
He admitted that the high lending rates have not only impacted the ability of businesses to access finance but have also increased the levels of bad debts across the banks.
Mading a is optimistic, however, that as inflation continues to drop and the economy starts to get back on track, lending rates should start to drop as well, thereby increasing demand and ease of access to finance.
Madinga says apart from export s, the agricultural sector will continue to be an attractive sector to support, notwithstanding the drought that some parts of the country have experienced this season.
“FMB has been a strong supporter of this sector and will continue to do so this year and in the future. We will continue to enhance and improve our product offering for the smallholder farmers,” he said.
Madinga also said the recent drive by government to enhance and implement various irrigation programmes will be key to the diversification and growth agenda of the country and that FMB intends to work closely with government to irrigation development.
He said the SME sector will take prominence in the growth of the country’s economy and that FMB is ready to provide them with products and services that provide convenience for their businesses.
On the prospective mergers in the banking sector that could reduce FMB’s market position from number three in terms of assets and market share, Madinga said FMB will not be distracted to change its strategy for the sake of market share growth only
“Our strategy has been to grow our business in a cautious but sustainable manner that ensures that we give an acceptable return to our shareholders. We want to grow our business sustainably whilst we understand that competition is heightening with the planned merger and the entry of new banks,” he said.
He said FMB will continue to invest in technology in order to adapt to the ever changing world and needs of its clients.
“We believe that the future lies in reaching out to the unbanked. Through our IT platform, we have already began to see the benefit of technology in supporting financial inclusion,” he said.
