Employers Consultative Association of Malawi (Ecam) is reviewing the International Labour Organisation (ILO)-supported Corridor Economic Empowerment Innovation Fund (Ceeif) to be in line with the current economic environment.
Ceeif is a facility aimed at addressing the needs of vulnerable groups of people operating in the informal sector, particularly along selected transport corridors.
Ecam chief executive officer Beyani Munthali, in an interview on Thursday, said they want to ensure there is access to credit by the vulnerable group, which is being hindered by high commercial banks interest rates.
“The project, which is being reviewed currently, has stimulated economic opportunities through promoting decent work for populations located along selected transport corridors to provide viable survival alternatives,” he said.
Munthali said because of high lending rates at around 39 percent, access to credit to finance businesses is a challenge, particuarly for small and medium enterprises (SMEs).
Small and Medium Enterprises Association of Malawi (Smea) president James Chiutsi said in an environment where interest rates are exorbitant, SMEs cannot survive.
He said: “Access to finance for SMEs is already limited in Malawi. In this environment, it is like SMEs are producing only to pay back high interest rates and this obviously leaves no funds for growth. The end result is stunted or indeed negative growth of the SMEs sector.”