RBZ places Lion Microfinance under curatorship

30 Jul, 2019 - 00:07 0 Views
RBZ places Lion Microfinance under curatorship

The Herald

The Reserve Bank of Zimbabwe (RBZ)  said on Saturday it had placed money lender, Lion Microfinance under  curatorship for three months due to undercapitalisation and weak  management.

Microfinance institutions (MFIs) operating in Zimbabwe are required to  meet a minimum capital requirement of RTGS $5 million.

In a notice, the RBZ said Lion microfinance had been placed under the  curatorship of the Deposit Protection Corporation.

“Notice is hereby given that Lion Microfinance Limited has today been  placed under the management of a curator, for a period of three months  in terms of the Microfinance Act (Chapter 24:29),” the Central Bank  said.

“This follows a determination that the institution is not in a sound  financial condition mainly due to critical undercapitalisation and weak  corporate governance.”

Zimbabwe’s microfinance sector has continued to register a strong  performance as commercial banks are seen by many as too restrictive and  not pro-poor in terms of lending.

According to statistics, local micro-financiers increased lending to  various sectors of the economy by 9 percent to RTGS$225,8 million in the  first quarter of 2019 compared to the same period last year.

A total of 205 microfinance institutions were operational in Zimbabwe  as at December 31, 2018, with six of them being deposit-taking MFIs. –  New Ziana.

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