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NBM dates Mzimba business customers, urges for resilience in face of current economic crisis

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National Bank of Malawi (NBM) has called for economic resilience among small and medium entrepreneurs (SMEs) amid the current economic crisis, which has seen the cost of borrowing soaring high.

NBM head of personal and business banking division Oswin Kasunda said after a customer interaction session in Mzimba on Saturday that the poor performance of the economy has seen the bank registering a high number of loan defaulters as interest rates have remained high.

“The economy is not doing very well in the face of high and inflation rates and businesses, especially SMEs, are the worst hit and will fall into default because they are not resilient enough to economic challenges.

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“This is why we are here appealing and offering economic advice to our clients on credit management,” said Kasunda.

Kasunda, however, said despite the economic turbulence, there are oth choose to default due to dishonesty and poor credit culture.

He thus disclosed that the bank has aggressive and effective ways of dealing with such cases in order to sustain its business on the highly competitive market.

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“Most of us, Malawians have a very bad credit culture.

People will simply choose not to pay back a loan just for the sake of it forgetting that such decisions tend to punish innocent clients who come for the credit facility in good faith.

“However, as a bank we are managing. We have a tolerable level of defaulters because we realise that business is about risks,” he explained.

During the interactions, the bank’s customers also raised concern over the strict conditions that NBM prescribes to its customers before issuing a loan, saying some of them have failed to access the credit facility after failing to meet the conditions.

“There are a number of areas that the bank needs to work on and the most crucial one is on loans, one of the conditions that they look for is security and most of us small entrepreneurs barely have fixed assets to warrant loan accessibility,” said one customer, Peter Jiya.

In response, the bank said all their conditions are in line with their regulators requirements which is the Reserve Bank of Malawi (RBM) and that they cannot operate outside such parameters.

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