By Wezzie Gausi:
The National Economic Empowerment Fund (Neef) has requested for an additional K5 billion from the Treasury to meet its loan disbursement obligations this financial year.
The Treasury allocated K10 billion to the institution in the current financial year.
Speaking after appearing before the Legal Affairs Committee of Parliament on Wednesday in Lilongwe, Neef Chief Executive Officer Humphrey Mdyetseni said the institution has disbursed K13 billion in loans so far.
He said although the Treasury allocated it K10 billion, the institution managed to raise some money for the loans.
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“To operate smoothly to the next financial year, we will need to get more funding from the Treasury and we have requested for an additional K5 billion.
“Our main challenge has been to recover the loans from some people. We have 30 percent of people that are having difficulties to pay back the loans and we believe, if these people are to pay back, more people will benefit from Neef loans,” Mdyetseni said.
The committee chairperson Albert Mbawala said the committee was interested to know how the institution was dealing with issues of corruption.
He said whenever money is involved, there are issues of corruption happening in most cases.
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“We are impressed with how the institution is doing its job. We understand they need more resources to be able to reach out to as many people as possible.
“We believe the Treasury will do the needful to provide more resources so that Neef is able to operate without challenges. However, our committee will ensure that no issues to do with corruption are happening at the institution,” Mbawala said.
Since February 2021, Neef has managed to disburse K73 billion in loans across Malawi.
Recently, Neef said it registered an after-tax loss of K13.6 billion, with the status of non-performing loans also increasing.
The loss comes on the heels of another loss of K6.03 billion recorded as at September 30 2022.
The Ministry of Finance and Economic Affairs 2023 Annual Economic Report released as part of budget documents has attributed the loss and poor performance to weak systems and a high default rate.
