By Wezzie Gausi:
The National Economic Empowerment Fund (NEEF) says it has beaten its loan target by K23 billion in three years.
Neef started the loan disbursement on February 11, 2021, after changing the name from Malawi Rural Development Fund (Mardef).
In an interview, Neef Chief Executive Officer Humphrey Mdyetseni said the organization planned to disburse K75 billion in three years but has given out K98 billion.
“This shows that people are willing to access the loans to beef up their businesses or even as start-up loans. We are happy to report that the program is working properly.
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“We have also managed to reach a 74 percent loan collection rate which is an improvement from 2022 when we were having a lot of people that were defaulting on the loans,” Mdyetseni said.
He also added that the institution has started using force recovery on some of the loans.
Centre for Social Accountability and Transparency (CSAT) Executive Director Willy Kambwandira said social protection loan facilities should avoid using force in recovery of loans as this will only aggravate the miserable situations of borrowers who are mostly the poor and youth.
“Instead, Neef should package their loan facilities accordingly where some borrowers are insured. We are not surprised that Neef is struggling to recover the loans as identification of beneficiaries is largely based on political affiliation.
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In the end responsible entities such as Neef tolerate lack of transparency and accountability by not enforcing the law,” Kambwandira said.
In September, 2023 Neef requested an addition of K5 billion from the Treasury if they are to meet the next financial year.
Neef was given K10 billion from the Treasury in the 2023/24 financial year.
