PM: Banks, financial institutions to help SMEs

Banks and micro financial institutions have agreed to issue soft loans to small scale entrepreneurs in a bid to support the government`s efforts of fighting poverty, the House was told yesterday.

Delivering his speech to adjourn the Bunge session yesterday, Prime Minister Edward Lowassa said the government had early this month met with some banks and other financial institutions issuing micro credit facilities in rural areas and agreed to start issuance of loans by December this year.

Lowassa said the Bank of Tanzania was now finalizing agreement with the banks and the micro financial institutions so that they can start giving loans to small scale entrepreneurs early next month.

Early this year, the government released 21bn/- as loan to small scale entrepreneurs and savings and credit societies to empower wananchi economically to fight poverty.

Up to September a total of 29bn/- had been given to 36,512 small scale entrepreneurs.

`In order to continue with the second phase of this programme, the government has decided to ask banks and micro-credit financial institutions giving loans to small scale entrepreneurs in rural areas to help,` he said.

The premier said BoT would give priority to districts that were not covered in the first phase of the programme.

He named the micro financial institutions that have agreed to give loans to small scale entrepreneurs as Postal Bank, SCCULT, Dunduliza, Akiba Commercial Bank, Pride and Presidential Trust Fund.

Others are Mbinga Community Bank in Ruvuma, Uchumi Commercial Bank in Kilimanjaro, Mufindi Community Bank in Iringa, Mwanga Community Bank in Kilimanjaro, Kagera Farmers` Cooperative Bank in Kagera, Kilimanjaro Cooperative Bank in Kilimanjaro and Azania Commercial Bank.

He said in the second phase many people; especially in areas where, CRDB and NMB are not operating, will have opportunity to access loans.

CRDB and NMB issued loans in the first phase programme.
On agriculture, the premier said the country still faced many challenges including unavailability of fertilisers and good seeds.

Other challenges include poor farm inputs, poor technology, poor infrastructure, lack of market and dependence on rain fed agriculture.

SOURCE: Guardian