The issue of government defaulting in settling monthly loan deduction payments to Micro-finance institutions that lend money to civil servants or government works has returned.
This has been comfirmed after sources from the MicroFins space disclosed to Zambian Business Times – ZBT that the government has not yet settled payments for the past three months creatiing serious liquidity and operational challenges to the sector.
Brief facts of the matter are that earlier, the Zambian Business Times – ZBT reported on government delayed arrear payments for the month of December 2025 and January 2026 following concerns raised by some of the MicroFin players that were affected due to the delay in payments.
The affected MicroFins who spoke to ZBT condemned the delayed arrears payments, because it affected their business operations as they found it hard to fund their operations and process refunds for their clients due to liquidity issues.
“Delayed arrears payments have really affected our business operations and our clients because we are unable to process their refunds. For example, the refunds for December are not yet paid and because we don’t have funds to be able to process them.” This is leading to customer complaints and dissatisfaction.
However, when Zambian Business-Times reached out to the The Ministry of Finance and National Planning through the Secretary to the Treasury – Felix Nkulukusa confirmed that the only arrears government was yet to remit were for February and March to Micro-financial institutions, Financial Institutions & other registered micro lenders which gives loans to government workers.
Nkulukusa at that time made assurance that the February outstanding loan deduction will be settled together with the one for March in April 2026.
“ Currently the only month which is outstanding is February and we should catch up in terms of payments in April together with the one for March which is due”, said Nkulukusa.
Following information received over government defaulting on it’s monthly obligations and not settling the arrears as at the end of May month end and arrears further accumulating to 3 months, confirmed by industry players, ZBT again reached out to The Secretary to the Treasury – Felix Nkulukusa to find out what is again causing the delay?
However, the Secretary to the Treasury who at the time confirmed he was out of the country, requested for a press query to be sent to the Ministry of Finance – a copy of whish has been been shared with the Principle Public Relations officer Chileshe Kandeta.
However, at the time of publishing this report, no response has been received by ZBT.
The defaults of monthly repayments by Government to Microfins and other lenders are a strain to credit rating and reporting and sets a precedence that ends up spilling into a sector wide challenge.
Moreover, these are some of the challenges that continue to drive up the cost of lending in Zambia.
Article by Justine Phiri
