No more money for loans

 THE state-owned National Development Bank (NDB) does not have money to carry on with delivery of its loan services, managing director Moses Liu says.

He said lack of Government funding had hindered funding of small to medium enterprises (SMEs) loans.

“We have approved loans valued at over K53 million for 498 customers from the SME sector which unfortunately could not be funded because of lack of funding,” Liu said. 

He said NDB clients needed to know the bank’s position in terms of its ability to fund loans going forward. “NDB cannot fully implement Government’s SME stimulus package which was launched at end of 2012. 

“On January 1, 2013, NDB reduced interest rate to 6.5 per cent to implement the Government’s stimulus package.” 

Liu said the current situation was made worse by the fact that the Government had not provided adequate funding to NDB to lend to the SME sector this year. 

“The undertaking was that the Government would provide K100 million every year to support NDB to fund at this very low rate, very concessional rate,” he said. 

“However, so far, since 2013, we have received only K140 million from the Government out of the K300 million that it was supposed to provide to support this programme (stimulus package) and therefore, unfortunately the Government has underfunded NDB with K160 million to date.

“It is now August and the Government did not release the K50 million that was allocated to NDB under the 2015 national budget. 

“Despite the lack of funding, NDB has been able to continue to fund our SME, most of them are start-ups.

“It is unfortunate that this has continued to have an effect on our organisation both in terms of financial operations and operational sustainability going forward.

“Unfortunately due to lack of funding, it has hampered the roll-out of these important projects, particularly the Stret Pasin Incubation Programme and the People’s Micro Bank’s operations, in terms of assisting our small people to do business.”