STAFF REPORTER
The Reserve Bank of Zimbabwe (RBZ) has disbursed ZWL$2.5bn through banks to boost the critical productive sectors and the winter wheat programme under the Covid-19 pandemic economic recovery and stimulus package.
President Emmerson Mnangagwa last month unveiled an ZWL$18bn stimulus package, aimed at reviving the economy that has been adversely affected by the deadly virus.
In a statement, the Ministry of Finance and Economic Development said businesses intending to access funds under the government’s stimulus package to deal with the effects of Covid-19 and the lockdown have to approach their own banks, that will be administering the loan packages under normal banking rules.
The banks in turn are expected to act with due diligence, know their customers, monitor use of the money, ensure loans are repaid and share the risks with the government that will provide guarantees.
“Implementation of the economic recovery and stimulus package has already started in earnest with the RBZ having already disbursed ZWL$2.5bn for the productive sectors and winter wheat programme.Other than capital grants, which are being disbursed through various line ministries, all productive sector support will be financed by banks through the normal banking channels with Government providing requisite guarantees to the financial institutions based on a risk sharing model,” the Finance Ministry said.
The productive sectors will access the facility at an interest rate of not more than 20% and a grace period of up to three months will be given to allow businesses to effectively recover from the effects of the Covid-19 pandemic and the resulting lockdown.
Through the risk sharing model, banks will conduct credit assessment and due diligence of the applicants, with Government providing bank guarantees.
Banks are expected to monitor and evaluate the use of the resources by borrowers to ensure the beneficiaries will repay the loans accessed, the Ministry of Finance and Economic Develooment said.
Government said banks are supposed to ensure beneficiaries must have a valid tax clearance certificate from Zimra accompanied by record of tax compliance history and a valid compliance certificate from NSSA.
When disbursing funds under the facilities, priority will be given to existing projects while new projects will be considered in the health sector if they result in the localisation of supply chain in the production of personal protective equipment (PPEs) for the Covid-19 pandemic.
