Financial institutions advised to stick to interest rates

By Lovemore Khomo

Government has warned financial institutions against implementing high interest rates to borrowers than stipulated by the law.

Minister of Trade and Industry Sosten Gwengwe made the remarks during the commemoration of World Consumer Rights Day on Thursday in Kasungu.

Gwengwe accused some financial institutions of increasing rates than agreed during processing of the loans to borrowers.

“Stop taking advantage of small-scale business persons by changing statement of accounts when they start paying back the loans.” warned Gwengwe.

He said, “We don’t want reports that you are implementing high interest rates than stipulated by the financial laws and regulations of the land. That will be a sin.”

The Trade and Industry Minister, then called upon the banks and all financial institutions to reduce a list of collaterals to ensure that more people get loans to boost their businesses.

Gwengwe advised both Reserve Bank of Malawi and Competition for Fair Trading Commission (CFTC) to put their heads up to investigate those financial institutions which have broken the law, and punish them if found guilty.

“Protecting and ensuring competition amongst business operators is one of the core pillars of agenda 2063 which encourages establishment of business and manufacturing companies for boosting the country’s economy.” He emphasised

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