May 24, 2013 by Microfinance Africa
By Stephen Ssenkaaba, New Vision A LADDER can only mean one thing: Progress. That is why the Stromme Foundation recently chose this important tool to symbolize their movetowards greater heights in their activities to improve the lives of the poor in Uganda. “We build ladders. Unique, very special ladders. On these ladders people climb to a better...
By Stephen Ssenkaaba, New Vision
A LADDER can only mean one thing: Progress. That is why the Stromme Foundation recently chose this important tool to symbolize their movetowards greater heights in their activities to improve the lives of the poor in Uganda. “We build ladders. Unique, very special ladders. On these ladders people climb to a better life,” says the foundation’s management in a report. “
As a development organisation whose goal is to eradicate poverty, the ladders are the means by which we are reaching this goal. In other words, we help people climb out of poverty,” says Priscilla Serukka, the Stromme Foundation regional director. Over the last year, the Stromme Foundation has invested time, energies and resources in special projects from education, to community empowerment.
“In 2012, we continued to implement education interventions through partnerships with 25 registered local organisations and community based organisations,” says Serukka. “We enrolled 49,830 children (51% of whom are girls), in 51 primary schools and 2,676 (47% of whom are girls) in 19early childhood development centres in the region,” says the Stromme regional report. Stromme has championed a project to educate girls. the Adolescent Girls Empowerment programme (Mazungmzo in Kiswahili) was implemented by five partners in Uganda and South Sudan.
According to Serukka, the programme targets girls from the ages of 14 to 19, who have dropped out of school and those that have never gone to school. Under this programme, the foundation last year enrolled 1,097 girls in 45 centres in Abim and Yumbe and in Central Equatoria in South Sudan. The girls who completed their courses in Abim graduated last year and their ceremony was graced by the First Lady,” says Serukka. Stromme worked handin- hand with the local governments to implement the programmes.
The Stromme Foundation has over the past one year provided training for adolescent girls in literary and numeracy skills and lessons on hygiene and family planning. “We have also provided occupational skills like hair dressing, knitting, tailoring, catering, weaving, agriculture and computer skills,” says Serukka. To improve the learning environment for school-going children, the organisation built 16 new classrooms and renovated 23 classrooms for pupils who previously took their lessons under trees or in incomplete structures.
Stromme has directed much of its support towards skills development for teachers, school management committees and parent-teacher associations. As a result of that intervention, 235 preservice teachers (43% of them women), 112 in-service teachers (37% of them women) and 577 school community representatives (33% of them women) have received training over the past year. There is a teacher training programme going in Sudan.
Nine teachers’ houses were also built, which has helped to reduce absenteeism. The interventions have improved education standards in beneficiary areas. Overall, the performance of pupils at primary seven in the communities and schools where we work registered improvement,” says the Stromme report. About 47% pupils joined secondary school compared to 44% in 2011, says Serukka. At 69% pass rate compared to 67% in 2011, the girl’s performance was particularly impressive.
Sports and Culture
In addition to this, Stromme foundation has continued to support sports, culture and arts, providing life skills training as a way of equipping young people with leadership capabilities, promoting knowledge and bringing about behavioural change to curb substance abuse, guard against HIV and AIDS and anti-social behaviour.
Such interventions have gone a long way in curbing social risks. They have also done a lot to empower young people and to equip them with practical skills for their own sustainability. “Through our partnership with Christian Youth Sports Contact (CHRISc) we have equipped over 26,000 young people with sports skills and knowledge on responsible and dignified behaviour in society,” says Serukka.
Stromme Microfinance East Africa Limited (SMF EA ltd) has been at the forefront of providing financial support by providing the poor with loans and micro finance services. Reports on the performance of this sector indicate adherence by the beneficiaries to meet repayment schedules. A stromme foundation report indicates that there was 2.8% growth in the company’s total assets and a 5.6% increase in the loan portfolio of microfinance partners while beneficiaries reached through this initiative rose to 243,935in the community microfinance programme.
The reports further indicate a 30% increase in the total number of clients to 85,345 from 63,932 in 2011 and 73% of the clients were women. And to emphasise the impact of this scheme, $4.1m was realised in cumulative savings. As a result of all these interventions, beneficiaries recorded positive changes in their lives. Indeed, many were able to acquire assets, others were able to send their children to school and a number improved their homes.
Despite all these achievements, a few challenges remain, especially shortage of funds and also in accounting for funds by some local leaders. Nevertheless, Stromme Foundation remains determined to grow even bigger and to reach out to more needy communities in the region. “We will remain committed to cause the development of the poor,” says Serukka. There is no doubt that Stromme foundation has done a tremendous job and with support from well-wishers, it will continue encouraging people to scale the heights of development.-->
May 15, 2013 by Microfinance Africa
By Victoria Mtomba, News Day The Reserve Bank of Zimbabwe will tighten the conditions under which micro-finance institutions (MFIs) will dispose of defaulting customers’ collateral security as a way of protecting people from predatory money lenders, governor Gideon Gono has said. Under the provisions of the Micro-Finance Bill, money lenders...
By Victoria Mtomba, News Day
The Reserve Bank of Zimbabwe will tighten the conditions under which micro-finance institutions (MFIs) will dispose of defaulting customers’ collateral security as a way of protecting people from predatory money lenders, governor Gideon Gono has said.
Under the provisions of the Micro-Finance Bill, money lenders will first have to secure a court order authorising the disposal of the security.
Giving oral evidence before the Budget, Finance and Investment Promotion Committee in Parliament on Monday, Gono said the purpose of the Bill was to, among other things, address the existing regulatory deficiencies and protect members of the public from the risks associated with services offered by MFIs.
“The Bill provides that no MFI may dispose of a customer’s security without obtaining a court order. The Bill requires MFIs to conduct their business in accordance with sound administrative and accounting practices to keep records of transactions,” Gono said.
The Bill comes at a time when there is a high demand of loans in the economy due to liquidity challenges. In 2012, the banking sector availed 16% of loans and advances to households, according to figures from the central bank.
The country has at least 37 micro-finance institutions from 1 800 micro-finance institutions that closed during the hyperinflation period in 2008.
Gono said the coming into operation of the Bill would result in some provisions in the Banking Act currently governing micro-finance banks being repealed and wholly superseded by the more comprehensive provisions in the Bill.
He said the Bill seeks to fill in the regulatory framework for credit only and deposit-taking MFIs.
“The main difference between the two types of Microfinance institutions is that money lenders predominantly lend money to individual consumer loans and to small businesses, while Micro-finance Banks are, in addition to the lending, are also allowed to take deposits from the public,” Gono said.
He said the Bill would address the problems that have been faced by the sector that include the unregulated interest rates charged by money lenders, the lack of supervision of MFIs by authorities and the sale of borrowers’ properties without following the legal process.
He added that a $5 million minimum capital requirement would be required for microfinance banks as opposed to $25 000 required for credit MFIs to protect depositors.-->
May 14, 2013 by Microfinance Africa
THE Reserve Bank of Zimbabwe plans to raise minimum capital requirements for microfinance institutions from the present US$25 000 to US$5 million as part of a cocktail of measures the central bank said are aimed at protecting the public. Central Bank Governor, Dr Gideon Gono said the new requirements would be brought into effect once the Micro-Finance...
THE Reserve Bank of Zimbabwe plans to raise minimum capital requirements for microfinance institutions from the present US$25 000 to US$5 million as part of a cocktail of measures the central bank said are aimed at protecting the public.
Central Bank Governor, Dr Gideon Gono said the new requirements would be brought into effect once the Micro-Finance Bill, now before Parliament comes into effect.
Dr Gono said this yesterday while giving oral evidence before a Parliamentary portfolio on Budget, Finance and Investment Promotion on the central bank’s views on the proposed legislation.
Bulawayo South MP, Eddie Cross (MDC-T) chaired the committee on behalf of Goromonzi South MP, Paddy Zhanda (Zanu PF), who was said to be away on business.
“The deposit taking function of micro-finance banks requires that they be subjected to more stringent regulation and supervision, including a minimum capital requirement of US$5 million as opposed to US$25,000 currently applicable for credit only micro-finance as that is designed to protect depositors,” said Dr Gono.
“The US$5 million is not required all at once, it is staggered for say five years meaning it can actually come from their profits.
“This is because those who borrow from them are vulnerable people like civil servants.”
He said there were 164 micro-finance out of 257 financial institutions the RBZ supervised constituting 64 percent hence it was critical to have regulations dedicated towards the affairs of the greatest number of players as what the Finance ministry sought to do.
Unethical and illegal conduct by the institutions, said Dr Gono, have in the past been reported in the media, some of which include charging usurious interest rates as high as 50 percent per month on loans advanced to the public.
He said they have also operated pyramid schemes where unsustainably high returns were promised investors, making desperate borrowers sign documents ceding their immovable properties to the lender and selling or disposing borrowers’ properties.
“Since the advent of multi-currency system, interest rates charged by money lenders are currently unregulated, leaving borrowers entirely at their mercy, under the existing legislation, authorities are not sufficiently legally empowered to adequately supervise operations and to take corrective and punitive action to protect the public,” he said.
Dr Gono said the regulatory and supervisory framework of the Banking Act was mainly suited for mainstream banks and not micro-finance banks who require a separate regulatory framework.
He said the proposed Micro-finance Bill sought to provide stronger safeguards and measures to protect borrowers and depositors.
Appearing before the same committee, the Zimbabwe Association of Micro-finance Institution chief executive officer, Mr Godfrey Chitambo said while the Bill was progressive, a number of clauses needed clarification.
He said the Bill tended to favour the borrower than the lender in many respects as the lender could lose both the principal amount and interest if he was found wanting.
“The tone and effect of the Bill is tilted too much in favour of the borrower.
“The burden is too much on us so much that if a borrower prove that we did not inform him enough we will lose both the money we lended and the interest,” he said.
“The Bill makes no attempt to provide recourse to money lenders who are defrauded by cunning literate clients,” he said.
The Zimbabwe Stock Exchange also gave its views on the Securities Amendment Bill.
SOURCE: New Zimbabwe-->
May 13, 2013 by Microfinance Africa
The Central Bank of Kenya (CBK) has granted a licence to U&I Deposit Taking Microfinance Limited (hereafter referred to as U&I DTM Limited) to carry out community deposit-taking microfinance business. The licence has been issued pursuant to Section 6 (1) of the Microfinance Act, 2006 and Regulation 5 (3) of the Microfinance (Deposit-Taking...
The Central Bank of Kenya (CBK) has granted a licence to U&I Deposit Taking Microfinance Limited (hereafter referred to as U&I DTM Limited) to carry out community deposit-taking microfinance business. The licence has been issued pursuant to Section 6 (1) of the Microfinance Act, 2006 and Regulation 5 (3) of the Microfinance (Deposit-Taking Microfinance (DTM) Institutions) Regulations, 2008. U&I DTM Limited becomes the ninth deposit taking microfinance institution (DTM) to be licensed following the licensing of seven nationwide DTMs (Faulu Kenya DTM, Kenya Women Finance Trust DTM, SMEP DTM, REMU DTM, Rafiki DTM, Century DTM and SUMAC DTM) and one community-based DTM (Uwezo DTM). U&I DTM Limited, which is the second community DTM to be licensed under the Microfinance Act is a wholly-owned Kenyan company limited by shares, intends to operate within the Nairobi Central Business District (Starehe Division).
U&I DTM Limited has set up its head office cum branch along River Road (Asili Complex Building next to Kampala Coach Booking Office), Nairobi. The Applicant intends to begin operations with one flagship branch with intent to expand with time. Previously, the entity was engaged in credit only microfinance business before they transformed to a community DTM. The DTMs primary focus is the Micro and Small Enterprises (MSEs) as well as the financially excluded populations. The DTM also intends to target institutional-based employees in schools, colleges, restaurants, factories, and manufacturing industries situated in the Nairobi Central Business District (Starehe Division).
It is reported that micro, small and medium enterprises (MSMEs) and the informal sector represent over 90% of private businesses and contribute to more than 50% of GDP and account for about 63% of employment in most African countries. These enterprises thus form an integral part of the Kenyan economy by providing employment opportunities and contributing to economic growth and sustainable development. Despite these opportunities they face many challenges, including access to finance, which is often considered to be their most significant challenge. The Central Bank has thus been in the forefront in developing an all-inclusive financial system that reduces impediments to accessing finance, including MSMEs financing. The Central Bank has initiated, and will continue to support, reforms to develop effective legal, regulatory and supervisory frameworks that support innovations to enhance the development of MSME financing and growth.
The licensing of U&I DTM Limited to focus on MSMEs as one of its key niches thus reiterates the Central Bank’s commitment to the development of an all-inclusive financial system that serves different market segments with appropriate products. This is in line with CBK’s mandate to enhance financial inclusion and promote economic growth in Kenya, which are key tenets of Vision 2030.-->
May 10, 2013 by Microfinance Africa
Fifteen out of the 450 microfinance banks in the South-west have indicated their interest to merge with the stronger ones, an official of the banks’ association said. The South-west Zonal Chairman, National Association of Microfinance Banks (NAMBs), Mr Olufemi Babajide, said that the merger was to beat the CBN’s directive that the banks...
May 9, 2013 by Microfinance Africa
Existing demand and future trends of Islamic Microfinance will be determined: Zubair Mughal 8th May, 13 (Sana’a/Lahore ): AlHuda Center of Islamic banking and economics (CIBE) Initiated a Islamic Microfinance research study for Yemen Microfinance Network (YMN) in Yemen. This study will be conducted in the Yemen’s capital Sana’a including...
Existing demand and future trends of Islamic Microfinance will be determined: Zubair Mughal
8th May, 13 (Sana’a/Lahore ): AlHuda Center of Islamic banking and economics (CIBE) Initiated a Islamic Microfinance research study for Yemen Microfinance Network (YMN) in Yemen. This study will be conducted in the Yemen’s capital Sana’a including Taiz, Adan and Almoukla, so that the Islamic Microfinance products can be examined broadly and further Islamic Microfinance products can be developed for Yemen Microfinance sector with the compatibility of existing structure. Consequently, maximum people utilize the Microfinance facility and the alleviation of poverty would be assured.
Najah Al-Mugahed Managing Director of Yemen Microfinance Network explained the association memorandum of research study that Microfinance market size in Yemen is more than one million but only 80,000 (eighty thousand) people are barely facilitating with the services and products of Microfinance which is approximately 8% of the total Microfinance market size. Its major reasons are; Non-existence of complete Islamic Microfinance range of products, Domination of Murabaha in Islamic Microfinance sector, increasing rate of Murabaha and percentage of interest in Microfinance are the obstacles in the expansion of Microfinance industry. An appropriate implementation plan would be prepared through this research study to strengthen the Yemen’s Microfinance sector.
Muhammad Saleh Al-Lai Chairman of Yemen Microfinance Network and Executive Director of Alamal Microfinance Bank proclaimed that Yemen’s Islamic Microfinance market is very promising and we want to make it stronger through this study so that Yemen could get a distinguished level through Islamic Microfinance. He further mentioned that this is our privileged that Al-amal Microfinance Bank won the award of Islamic Microfinance Challenge 2010 which was organized by Islamic Development Bank and CGAP (World Bank) which shows a clear understanding of our strong structure of Islamic Microfinance.
Muhammad Zubair Mughal Chief Executive Officer of Alhuda Center Islamic Banking and Economics (CIBE) said that our selection for the research study is a great honor for AlHuda CIBE. He mentioned that they have developed a strong research methodology for this study and used different research instruments e.g surveys, focus group discussion (FGDs), stake holder’s interviews, desk review of MFI’s and meetings with prestigious professionals of Microfinance industry to get primary & secondary information etc which will help to design the ideal products for Yemen Islamic Microfinance sector.
He further mentioned that the share of Islamic Microfinance in Yemen’s Microfinance sector is approximately 90% and remaining 10% are also converting their portfolio into Islamic Microfinance, Yemen Microfinance Industry will be further strengthened with the development of new Islamic Microfinance products, It will increase the outreach of Microfinance sector and help out to eradicate poverty#-->
May 8, 2013 by Microfinance Africa
Obinna Chima examines efforts by operators of microfinance banks to comply with the revised microfinance policy framework Globally, microfinance banks (MFBs) are known for their intermediation role, especially in the provision of financial services to micro and small businesses with the primary aim of poverty alleviation and financial inclusion....
Obinna Chima examines efforts by operators of microfinance banks to comply with the revised microfinance policy framework
Globally, microfinance banks (MFBs) are known for their intermediation role, especially in the provision of financial services to micro and small businesses with the primary aim of poverty alleviation and financial inclusion. MFBs were established to fill the gap created by the commercial banks by improving the socio-economic condition of the poor in the society.
As a result of the essential role small and medium scale enterprises (SMEs) that are largely described as the catalyst for economic growth, play in any economy, a vibrant microfinance banking system is always the target of policy makers.
Unfortunately, the MFB subsector in Nigeria has not been able to meet its objectives.
Consequently, in order to revamp the subsector, the Central Bank of Nigeria (CBN) recently extended the deadline for the implementation of the Revised Microfinance Policy Framework from December 31, 2012, to December 31, 2013.
The Director, Other Financial Institutions Department (OFID), CBN, Mr. Olufemi Fabamwo, had explained that the decision to extend the deadline was “to allow more time for capital raising and business combination options towards meeting the capital requirements for each category of MFB and for rationalising the existing branches/cash centres, etc., where necessary. Also, the uneven spread of MFBs in the country has remained a source of concern to operators.
For instance, the Nigeria Deposit Insurance Corporation (NDIC) recently expressed concern over the poor presence of MFBs in the Northern part of the country.
The Managing Director/Chief Executive Officer, NDIC, Mr. Umaru Ibrahim, insisted that the “grossly uneven” distribution of MFBs in the country was frustrating the country’s financial inclusion strategy. Ibrahim pointed out that out of the 869 MFBs in existence, 346 (39.81 per cent) were located in the South-west, 162 (18.64 per cent) in the South-east, 158 (18.8 per cent) in the North-central, while only 63 (7.5 per cent) and 32 (3.68 per cent) are located in the North-west and North-east respectively. He disclosed that Lagos, Anambra and Abuja had the highest number of MFBs.
“The uneven distribution has exposed the untapped potentials that require attention in order to realise the government’s policy on financial inclusion,” the NDIC boss added.
The Revised Microfinance Policy Framework
Part of the revised guidelines stipulates that all MFBs that have elected to remain as Unit MFBs as indicated in the compliance plans, are required to close any existing branches/cash centres, etc., subject to prior approval of the CBN in writing and adequate notification to existing customers, who should be advised to migrate their accounts to the MFB’s head office, while dissenting customers should be settled.
A Unit MFB is authorised to operate in one location. It shall be required to have a minimum paid-up capital of N20 million and is prohibited from having branches and/or cash centers.
Also, a State MFB is authorised to operate in one state or the Federal Capital Territory (FCT). It shall be required to have a minimum paid-up capital of N100 million and is allowed to open branches within the same state or FCT, subject to prior written approval of the CBN for each new branch or cash centre.
In the same vein, a National MFB is authorised to operate in more than one state including the FCT. It shall be required to have a minimum paid-up capital of N2 billion, and is allowed to open branches in all states of the federation and the FCT, subject to prior written approval of the CBN for each new branch or cash centre.
The CBN added: “For the avoidance of doubt, all ‘customer interaction centers, meeting points and customer service centres, or similar outlets, once located outside the registered business premises of a Unit MFB shall be regarded as unauthorised/unapproved branches/cash centres.
“All previous approvals for such outlets for Unit MFBs have become null and void from the date of approval of the Revised Policy Framework by the Board of Directors of the CBN.”
According to the CBN, penalty for operating a branch/cash centre without its prior approval as stipulated in Section 13.1(b) of the Revised Guidelines for MFBs attracts fine of N250,000 per branch for a Unit MFB, N500,000 per branch for a State MFB and N1,000,000 per branch for a National MFB.
“In addition, such unapproved branched/cash centers shall be closed within thirty (30) days. Failure to close an unapproved branch or cash centre shall attract a fine of N5, 000 for each day of default, irrespective of the category of MFB. Moreover, failure to comply with any directive issued by the CBN, as stipulated in Section 19(i) of the Revised Guidelines for MFBs, is a ground for revocation of licenses.
The National President, National Association of Microfinance Bank (NAMB), Mr. Jethro Akun, who spoke with THISDAY, welcomed the decision of the central bank to extend the deadline. He assured that his members would comply with the new deadline.
However, Akun expressed disapproval over what he described as ‘policy inconsistency’ in the revised policy framework.
He explained: “The issue is that when we met with the central bank governor, we told him that the policy can be amended. If you say national microfinance banks can open branches all over the federation with CBN’s approval, state microfinance banks can open branches all over the state with CBN’s approval, what stops the CBN from also saying that unit microfinance banks can open branches all over the local government with CBN’s approval?
“Why are they limiting the unit microfinance banks? That shows policy inconsistency. If someone has decided to remain a unit microfinance bank, you can’t restrict him.” Akun, however, revealed that the central bank has set up a technical committee to look into the matter, even as he expressed optimism that it would be resolved before December.
Commenting on the extension of the deadline, he said: “We are working with our people to make sure we comply. We are also listening, not just to the operators, but also to the investors.
“But we are happy with the disposition of the CBN towards us. It is the microfinance banks that will promote the central bank’s financial inclusion strategy and financial literacy in this country.”
On his part, the Chairman, NAMB, South-west Chapter, Mr. Olufemi Babajide, pointed out that MFB operators did not have problem with the new capital requirement that goes with the revised framework.
Babajide added: “There is stability in the sub-sector. What we need now is funding. The Microfinance Development Fund needs to be released so that our members can access it.”
On his part, the Managing Director/Chief Executive Officer, GTI Microfinance Bank Limited, Mr. Abimbola Adewale, commended the central bank over the revised policy framework for MFBs.
“The CBN has done its best by issuing the policy. For me, I think it is a wonderful policy,” the GTI boss said. Similarly, the Managing Director/Chief Executive Officer, Complete Trust Microfinance Bank Limited, Mr. Chinedu Nwogem, said that the revised guideline would promote stability in the industry.
SOURCE: This Day Live-->
Head of Micro-finance and Banking Supervision at the Bank of Ghana (BoG), Dr. Yaw Gyima-Larbi has revealed that 171 financial institutions have been issued with final license to legally operate in the country. According to him, the financial institutions are made up of 143 Micro-finance Companies, 25 money lending institutions and 3 Financial NGOs. He...
Faced with major problems, the State of Cameroon will put in 21 billion francs CFA to usher financial reforms into the Microfinance sector, according to the French daily, Mutations of Tuesday April 20, 2013. To improve on the quality of services offered by Microfinance Institutions (MFIs), government will intensify the training of owners, managers...
May 2, 2013 by Microfinance Africa
THE now defunct Royal Bank is considering downgrading to a microfinance institution (MFI) as the bank plans to embark on a restructuring programme mired in controversy, NewsDay has learnt. According to the bank’s court papers opposing a Reserve Bank of Zimbabwe High Court application seeking for a final order to liquidate the financial institution,...
THE now defunct Royal Bank is considering downgrading to a microfinance institution (MFI) as the bank plans to embark on a restructuring programme mired in controversy, NewsDay has learnt.
According to the bank’s court papers opposing a Reserve Bank of Zimbabwe High Court application seeking for a final order to liquidate the financial institution, Royal Bank, which surrendered its operating licence last July due to capital constraints, wants to bounce back into the financial services sector.
In its discussion document titled: Royal Bank Limited Proposed Restructuring and Recapitalisation, the commercial bank last month engaged local external auditors PFK Chartered Accountants as financial advisors to craft its comeback bid.
The bank, which according to the documents owned land and buildings valued at $4,8 million, contends that it needed to restructure to settle the $3,7 million debt owed to its major creditors.
“Having considered the challenges faced by Royal Bank, both financially and in terms of market capitalisation, PFK have assessed the various options available to Royal Bank,” reads the document in part.
“In this regard, it is proposed that Royal converts its banking licence to microfinance licence. The capital requirement for microfinance (institutions) is manageable compared to banking licence. This will also allow Royal Bank adequate time to rebuild its brand and image. Microfinance organisations enjoy better margins than commercial banks.”
As part of Royal Bank’s restructuring programme, PFK also advised that the bank can also restructure its balance sheet through conversion of major current liabilities into equity or long debt through a scheme of arrangement.
The financial advisor also proposed that Royal could also raise funds through issue of equity shares and convertible debentures, with the funds to be applied against the repayment of the bank’s depositors and other liabilities, including the provisional liquidators costs.”
Funds raised from the private placement, the PFK advised, would also be used to roll out the proposed MFI.
Last year, the central bank raised the minimum capital levels for MFIs to $5 million from $1 million in a bid to minimise systemic risks in the banking sector.
With Royal converting into an MFI, could this be a case of jumping from the frying pan to the fire?
Already the central bank has during the past year closed two deposit accepting MFIs for breaching the Banking Act.
Experts say, low disposable incomes and marginal salary adjustments by some companies on the back of a rising cost of living, has forced the public to rely on MFIs which have less stricter borrowing requirements compared to traditional banks.
Royal Bank was re-licenced in October 2010 and granted a two-year grace period to meet the then $12,5 million minimum capital requirements.
The bank, however, failed to raise the capital.
SOURCE: News Day Zimbabwe-->