NBM Development Bank urged to go rural

By Kingsley Jassi:

Parliament has challenged NBM Development Bank to make a more rural impact if its contribution to the country’s development is to be visible.

But the bank says it has already made some inroads under the auspices of the World Bank-supported Financial Inclusion and Entrepreneurship Scaling (FInES) project.

NBM Development Bank General Manager Bernard Masi appeared before the Parliamentary Committee on Trade and Tourism on Wednesday to account for the impact made through FINeS funds the bank accessed.

According to Masi, under the FInES project, the bank disbursed above K10.4 billion to 52 small enterprises across the country, with women dominating access as they got K7.1 billion of the total capital financing.

However, one of the committee members, Mark Katsonga Phiri, noted that there was a concentration of urban areas in the loan distribution list, with Lilongwe taking much of the loans.

“I expected the bank to make more impact in the rural areas because that’s where there is more poverty but I see you concentrated in urban areas, particularly Lilongwe. Is there any explanation for this? queried Katsonga.

He cited some private schools and hospitals which have not only benefited the investors but also communities around the investments that are able to supply food stuffs and other materials for operations of businesses.

On Lilongwe dominating loan disbursements, taking up K5.1 billion of the total K10.4 billion, Masi commended the entrepreneurial culture of the people in the city, who submitted business proposals.

Masi disclosed that the bank was working with international and local organisations with initiatives in agriculture and value addition for linkages with their beneficiaries for loan access, citing a collaboration that will see 900 farmers in Mchinji benefiting as a start.

He further said the bank was working on accessing credit lines with international financing institutions to extend the credit to local startups through equity financing in new and existing ventures as one practical risk-proof approach.