The Association of Microfinance Institutions in Zambia (AMIZ) says the interest rates on borrowing are likely to go down due to factors such as low inflation and a stable exchange rate.
Association Executive Director Webby Mate said factors such as low inflation and a stable exchange rate as well as a strong currency have an impact on the movement of interest rates
Speaking in an interview with the Zambian Business Times-ZBT, Mate commended government’s efforts towards lowering the inflation rate and stabilizing the kwacha adding that government is on the right path.
“I know what they are doing will have an impact on the cost of money ultimately so they are on the right trajectory but they should continue so that things can get better for small business people. Inflation is going down, the exchange rate is stabilizing and also the kwacha is strengthening, those are key indicators that should be able to impact on the movement of the interest rates”, he said.
Mate mentioned that interest rates are quite high but government has made pronouncements that it would like the cost of money to small businesses to come down therefore the association is looking forward to seeing government taking more steps to actualise such plans.
He noted that stabilizing the economy is important because when the economy is stable, the exchange rate will not be changing anyhow which helps one to plan adding that a stable economy also means the rate at which prices of goods change becomes stable.
Mate mentioned that the Ministry of Finance should focus on putting in place strategies that would stabilize the economy and make it more conducive for the growth of businesses, which would help interest rates be more affordable.
