Harare – Premier Service Medical Aid Society said it has successfully launched its microfinance subsidiary, Premier Service Microfinance which it says started operating in July this year targeting civil servants and anticipating to cater for the private sector in the near future.

In an exclusive interview with Equity Axis on the side lines of the on-going 8^th edition of the SMEs International Business Expo in the capital on Thursday, PSM Operation Manager, Kenneth Gandawa said the microfinance division is now operational.

This year’s edition of the expo is going under the theme, “Explore Innovate- Implement, A New Economic Order for Business in the Digital Era”.

“The division was registered in 2016 but we applied for the licence to operate as a bank at the Reserve Bank of Zimbabwe in June this year and we started operating on the 1^st of July this year.

“We started issuing loans to civil servants through a product called SSB and soon we will be extending the service to the private sector. The two fall under personal or consumable loans,” said Gandawa.

Such loans the microfinance is issuing are unsecured loans called signature loans and are advanced on the basis of the borrower's credit-history and ability to repay the loan from personal income.

Repayment is usually through fixed amount instalments over a fixed term.

In the same interview, Gandawa also pointed out that there are working on a program that will cater for the SMEs.

“Currently we are working on the product we are going to launch for the SMEs. The program is already on developmental stage and is about to be launched.”

He said they will assess the individuals who will apply for the loans to see if they qualify.

“We will see if the individual is economically active, that is, they own a small business which generates income on a daily or monthly basis and the business should be running.

“The business has to be registered with the relevant authorities and the applicant should produce their business plan so that we can see their business requirements.”

Gandawa said when one qualifies the package either comes as 100 percent cash or as 50 percent cash and the rest as raw materials a move he says is aimed at minimising diversion of funds.

On collateral he said they accept both movable and non-movable assets depending on the risk attached to the applicant and the loan amount involved.

Going forward, Gandawa said there will be a number of innovative initiatives to better ways of delivery to their customers thereby making the product cheaper compared to other players in the market.

However, he said  he is not at liberty to disclose exactly what they will be offering at moment.

Equity Axis News