An interesting report via Daily Mail on CEEC initiatives to boost micro lending. Article reproduced below for alternative preservation :
CEEC sets up micro-lending project (Source : Daily Mail, 8th September 2009)
The Citizen Economic Empowerment Commission (CEEC) has introduced a micro lending product for all existing markets countrywide with a threshold of K100 million per market.
CEEC director of empowerment, Ricardo Lupenga, says the commission has approved the mode of lending called peer lending, where individual markets are required to select a group of six to 10 people to access the loan.
Mr Lupenga says the commission will lend K100 million to individual market executives after obtaining clearance from the national market associations in each province.
Mr Lupenga said in an interview in Lusaka that the group would be used as collateral. The group that fails to pay back will be blacklisted from getting other loans.
He said the commission will soon advertise in the media for applications.
Mr Lupenga said market executives will also be obliged to thoroughly scrutinise the borrowing group members and decide how much credit to give to each group.
The executives will also be obliged to ensure that the borrowing group executives organise their members to adhere to any group by laws.
He said the cost of borrowing is at 12 percent interest rate based on CEEC rates put cross to all targeted citizens.
Those dealing in product portfolios such as beans, fish, tomatoes and chickens will be given between K200, 000 and K500, 000 with a maximum tenure of one month.
The other product portfolio will be given amounts ranging from K500, 000 to K1 million with a maximum tenure of 1.5 months, K1 million to K2.5 million and K2.5 million to K5 million with maximum tenures of two and three months.
Mr Lupenga said the commission will give the K100 million to market executive members as a revolving fund and manage the credit groups and monitor their payment.
He also said six markets have so far been identified for possible funding in Chinsali, Kasama, Ndola (main masala and chifubu), Mongu, Livingstone and Chipata.
Recently, the CEEC successfully implemented a marketeer’s product in Lusaka and North Western Provinces through Zambia National Marketeers Association (ZANAMA) and Zambia National Marketeers Credit Association ( ZANAMACA).
Twelve markets were involved, five in Lusaka including Chawama, Mutendere, Ngombe, Chitukuko and Soweto.
In Solwezi seven markets, Chawama, Messenger and Solwezi main, benefited in the first funding tranche.
Mr Lupenga said during this pilot phase a total of K400 million was disbursed to 595 marketeers.
However, the commission has changed the approach from dealing with market associations directly to individual markets affiliated to national associations.