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Reserve Bank of Malawi reviews success of Covid-19 measures

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The Reserve Bank of Malawi (RBM) has said it is reviewing measures of mitigating the impact of Covid-19 on distressed firms following the expiry of the three months period for which the measures were designed.

In April this year, RBM announced a series of measures in partnership with the Bankers Association of Malawi (Bam) Malawi Unions of Savings and Credit Cooperatives (Muscco) as well as telecommunication firms.

The measures included a three-month moratorium by banks and saccos to distressed customers which gave them a three month breather not to repay interest on loans.

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On their part, mobile phone companies, among others pledged to waive transaction fees for mobile transactions as one way of promoting a cashless society in the wake of Covid-19.

But in an interview Thursday, RBM Spokesperson, Mbane Ngwira, said the Central Bank has kick started the process of reviewing the effectiveness of the measures following the expiry of the three months period.

“The three months period was chosen not because it was estimated that the Covid 19 pandemic would end by that time but to give room for assessment of the impact of the measures on the financial institutions as well as the individuals and companies.

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“That assessment would inform the financial industry on the way forward. That’s whether to continue, enhance or change in anyway, the measures that were introduced in April. The assessment is in progress,” Ngwira said.

In addition to the moratorium Bam also reduced by 40 percent the fees and charges related to internet banking, mobile payments and other related services, except for Point of Sale devices and master card related payment in order to encourage usage of electronic transactions.

Banks had also pledged to defer all payments of bonuses and dividends until the risk of Covid-19 is under control.

On its part, RBM had pledged to activate the Emergency Liquidity Assistance Facility and make it available to banks on a case by case basis.

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