Namibia: Micro loans in Namibia Grew by 34% in 2011
According to a report attributed to the Namibia Financial Institutions Supervisory Authority (NAMFISA), a regulatory body under the Namibian Ministry of Finance, microloans outstanding in Namibia grew by 34 percent during 2011, reaching a total amount of NAD 1.5 billion (USD 183 million). This is reportedly due to an increase in lending for consumption. In the last calendar quarter of 2011, microlending represented 3.4 percent of the total credit offered by commercial banks. This is expected to grow to four percent at the end of 2012 and five percent in 2013. “So the rate at which micro-lending is currently growing, is clearly alarming,” Rudolf Kuschke, analyst at Simonis Storm Securities, reportedly said.
NAD 1.44 billion (USD 175 million) out of the NAD 1.5 billion (USD 183 million) disbursed by registered microlenders during the fourth quarter of 2011 were “term” loans, which have a term of six to 60 months and an average annual interest rate of 22 percent. There was a 60-percent increase in the term loans outstanding from December 2010 to December 2011 reaching NAD 286 million (USD 34.8 million). The average loan amount for term loans was of NAD 11,131 (USD 1,355), which represented a 39-percent increase compared with 2010. The total disbursal of “pay-day” loans, which have a one-month term and an average interest rate of 30 percent, decreased from NAD 62.7 million (USD 7.6 million) in 2010, to NAD 61.6 million (USD 7.5 million) in 2011. The average loan amount for pay-day loans fell from NAD 970 (USD 118) to NAD 944 (USD 114). Registered microlenders offered 25,000 term loans and 135,000 pay-day loans during the fourth calendar quarter of 2011.
Meanwhile, a new report from Standard Bank of South Africa reveals that many financial services remain unavailable to the majority of the people that live in Africa. The report indicates that in Namibia about 48 percent have access to formal banks; in Zambia, 25 percent of the population has access to a bank; in Mozambique and Tanzania the number is reported to be less than a quarter of the population. In Nigeria, with a population of 150 million, 120 million reportedly have no access to formal banking. According to Standard Bank research analyst Simon Freemantle, “Access to finance has been, and in the majority of African countries remains, one of the continent’s largest impediments to swifter socio-economic advance.”
According to Standard Bank, almost all of Sub-Saharan Africa’s top 100 banks—as measured by assets—are in South Africa, Nigeria, Angola and Mauritius. About 80 percent of the continent’s top 200 banks are in Nigeria, South Africa and North Africa.