Micro finances sever ties with Malawi govt
Financial institutions that lend money to civil servants in Malawi have severed ties with the government amid a row over K1.9 million which the micro finances claim has not been submitted to them three years now.
Duncan Phulusa, executive director of Micro Finance Network regretted that civil servants will no longer access the easy but extremely expensive loans until the government pays back the K1.9 million that the government deducted from the desperate civil servants mostly primary school teachers.
“We have been tossed from one office to another on this matter. We went to the accountant general to find out about our money but they sent us to the Reserve Bank of Malawi and the bank sent us back to the accountant general-s office and the accountant general sent us back to the central bank. We have no option now but suspend the loans until the government pays us our money,” said Phulusa.
Finance ministry spokesperson Nations Msowoya laughed off the matter in an interview saying micro finances could hardly survive with a K1.9 billion.
He said the government paid off all money owed to the microfinances last year.
Mosowya said there is need for the representatives of the government and microfinances to meet in a bid to sort out the misunderstandings.
A primary school teacher in Lilongwe said she borrowed just over K200000 and is expected to pay back over K600000 in three years time and she no gets a meagre K40000 a month.
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Shame on both of u!!! Zilibwno kuti mbava zokhazokha zikubelana. Bomalo mbava, micro f mbava.
borrowers should understand the terms before they borrow. In this case the teacher is paying something like 67% per annum at the end of 3 years in simple interest terms. This is glossily high! As repayment is spread over the three years, the interest is applicable on outstanding balances, which must be reducing with time. It was a ver expensive loan. Was it really worth taking? that depends on what the 200,000 was used for. Did it generate more than the 400,000 interest the teacher has/had to pay? Did the 200,000 when used by the teacher generate him or her… Read more »
You were given all information when borrowing and you were mweeee, now its time to repay you are complaining!!!! You must be very stupid.