Nyoni welcomes SMEs collateral Bill
SMALL to Medium Enterprises and Cooperative Development Minister Sithembiso Nyoni ( pictured left) has welcomed the proposed Movable Property Security Interests Bill saying it will assist small businesses to access loans easily from the banks.
The proposed Bill, that seeks to facilitate increased financial access to small and medium enterprises and communal farmers. is now set for public hearings.
In an interview yesterday, Minister Nyoni said: “A lot of SMEs do not have immovable property and they would now get access to credit with their movable properly as collateral.
“Some SMEs owners have good houses in the rural areas but they do not have title deeds hence this would be a good development.”
Currently, most small business owners are failing to access lines of credit from micro-finance institutions and banks due to lack of collateral security.
During a tour to Mupedzanhamo Flea Market yesterday, chairperson of the Parliamentary Portfolio Committee on SMEs and Cooperative Development Ms Dorothy Mangami said the Bill would help SMEs to realise their full potential.
“The Bill would help you get access to increased credit from banks using the movable property that you have as collateral security,” she said.
“We also encourage SMEs to have their input in the public hearings especially on the lending and borrowing aspect.”
Traders lamented that most banks were not considering them for credit and the few that were prepared to help had put in place stringent lending conditions. They said the lending rates were too high resulting in them failing to repay the loans on time.
Zanu-PF Mbare Ward 4 councillor Mr Martin Matinyanya said while a lot of money was realised at Mupedzanhamo, Government was losing out on revenue because SMEs could not deposit their money in banks since they would face difficulties withdrawing it.
“We realise a lot of money from selling here but we cannot deposit the money in our bank accounts as it would be difficult for us to withdraw it when we need it,” he said