—-The Zambia Union of Teachers (ZNUT) in Kapiri Mposhi has welcomed the government’s intention to register a microfinance institution for civil servants in the country.
ZNUT District Secretary, Edward Kunda, said the microfinance facility, once established, will enable civil servants access low interest loans for them to venture into larger investments.
In an interview with ZANIS Mr Kunda stated that civil servants have for a long time been exploited by private microfinance institutions that offer them loans at exorbitant interest rates in comparison to the proposed five per cent interest.
Minister of Finance, Alexander Chikwanda last week announced the registration of a Public Service Microfinance Institution which will be giving loans to public service workers at less than five percent interest.
Mr Kunda said the launch of the Public Service Microfinance Institution will also bring competition to the microfinance sector and result in the reduction of loan interest rates by players.
“This is a brilliant move by government. It is a respite to civil servants …We just hope it will come to fruition because civil servants are exploited by money lending institutions through high interest rates. A lot of workers are highly indebted with these institutions,” Mr Kunda said.
He stated that access to low interest loans will facilitate civil servants venturing in investments and effective participation in the economy of the country, adding that most civil servants were unable to invest because of limited access to capital.
Mr Kunda appealed to government to expedite the establishment of the facility.