THE Reserve Bank of Zimbabwe (RBZ) is planning to develop and maintain credit infrastructure meant to enhance financial inclusion, governor John Mangudya said yesterday.
Speaking at the Zimbabwe National Chamber of Commerce (ZNCC) Business Review Conference in Harare, Mangudya said the banks continue to support productive sectors of the economy with agriculture, mining, and manufacturing sectors topping the list of borrowers.
“The bank continues to work towards developing and maintaining a robust credit infrastructure to enhance financial inclusion. Farmers, for example, have been able to access loans securitised by movable properties — agricultural equipment (48%), household goods (16%), notarial general covering bonds (13%), and livestock (5%),” Mangudya said.
“A total of 42 security interest notices with a total amount of ZWL$130 89 billion have been registered under SMEs.”
This year’s conference was running under the theme Transforming Economic Realities into Market Opportunities.
This comes as support to the informal sector still lags the formal economy at a time when local banks are not lending as much as they should.
The push to support the informal sector comes as research carried out by the bank last year shows that this economic group generates over US$14 billion in annual income.
“The banks continue to support productive sectors of the economy. Agriculture at 17,7%, manufacturing at 13,82%, mining at 11,74%, and distribution at 13,30% dominate total lending in line with supporting productive sectors,” Mangudya said.
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“The loan-to-deposit ratio has been trending upwards from values below 40% in January 2021 to over 55% in August 2023. The manufacturing and distribution sectors’ loan-to-deposit ratios have surpassed the average for the entire economy.”
ZNCC president Mike Kamungeremu said the business fraternity was focused on coming up with solutions that foster private sector-led economic recovery and growth.
He urged the government to create an enabling environment by relaxing regulation in the sector.
“We aspire to continuously provide solutions that foster private sector-led economic recovery and growth. We implore the relevant authorities to allow markets to function at an optimal level. The government should limit its regulations for that to happen,” Kamungeremu said.
“In this regard, governor, the private sector is calling upon the government of Zimbabwe to simply create an enabling environment for businesses to operate to ensure efficient service delivery, provide certainty within the business environment, and [we will] deliver the necessary growth that is required to take us to upper-middle-income status by 2030.”
He said a conducive operating environment benefited all economic players, government included.
