By Benadetta Chiwanda Mia:
The Malawi Enterprise Development Fund (Medf), formerly National Economic Empowerment Fund (Neef), has recovered K8 billion from its K240 billion loan portfolio during a two-month recovery campaign.
The recovered amount represents about 3.33 percent of the total portfolio, with approximately K232 billion still in arrears as of April 2026.
In early February 2026, Medf issued a 60-day ultimatum to loan defaulters, demanding settlement of outstanding arrears.
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The fund warned that those who would fail to do so would face legal action or possible seizure of property.
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Medf spokesperson Elizabeth Mapemba told The Daily Times that the K8 billion was recovered during the campaign period, which elapsed on April 6.
She said Medf has since rolled out additional measures to recover the remaining arrears.
“The fund is implementing various loan recovery enforcement measures, including collateral confiscation and, where necessary, legal action,” she said.
However, economist Marvin Banda described the recovery rate as “abysmal”, saying it reflected deeper institutional weaknesses in government-led microfinancing.
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“Recovering 3.33 percent of roughly K240 billion is not a success story. It is a reminder of how deep the politically tied institutional problem runs,” Banda said.
However, Banda acknowledged that the recovery made within two months showed that enforcement measures could yield results.
“When pressure is applied, money can be recovered.
“However, it also reveals something more uncomfortable; that it’s not that many borrowers were unable to pay, they were simply unwilling,” he said.
Banda also stressed the need to insulate Medf from political interference and strengthen its legal framework.
“Development finance is not charity; it must be anchored in proper appraisal, realistic cash-flow assessments and disciplined follow-up,” he said.
He added that improving borrower capacity through business and technical support, alongside incentivising good repayment behaviour, could help rebuild a repayment culture.
As of December 2025, about 377 460 Malawians had obtained loans from the fund
