Some beneficiaries of the National Economic Empowerment Fund (NEEF) loans fear they may not repay their debts due to unfavorable business environment in the country.
Speaking in random interviews in Mzuzu, the beneficiaries stressed that the spike in prices of goods has greatly impacted their businesses.
“The economic instability is a demerit to our businesses. Potential customers have no money to buy from us,” said Maria Chipeta, who borrowed MK500,000.
“I invested the loan in Kaunjika (second hand clothes). Despite trying hard to vend, I’m not making profits. People have no money. I spend the whole day without selling.”
John Chirwa, another beneficiary, said: “Others have fled. Leaving the burden on their friends. They tried several businesses, which couldn’t materialize due to the unfavorable business environment in Malawi.”
Gregory Mzumara, who borrowed MK250,000, and pumped it in a grocery, in Mchengautuwa township, disclosed, his business has vanished into thin air, even before he has begun repaying his loan to NEEF.
“My grocery is in shambles. It’s on the verge of collapsing completely. Ironically, I’ve not began repaying the loan to NEEF,” he said.
Thumbiko Mwale, a seasoned economist cum tutor at Mzuzu Business College, concurred with the disgruntled business community, saying, the economic instability has messed up the business environment in the country.
“It’s true. With the economy in this state, they can’t thrive in business. It’s very difficult. Any business can’t work. Most people have no buying power…so I would agree with you,” he said.
NEEF loans have varied repayment periods, ranging from six months to yearly and above.
Government, in a quest to empower Malawians, has been implementing similar loan schemes since 2009. Unfortunately, due to what commentators describe as poor planning, the objectives of the same, have not been achieved ever since.