Soon-to-be -established government finance company, Malawi Enterprises Development Fund Limited (Medf), formally Malawi Rural Development Fund (Mardef) is now undergoing functional reviews ahead of starting operations.
The new company would merge Mardef and Youth Enterprise Development Fund (Yedf) and will also be responsible for coordinating the Farm Input Loan Programme (Filp) which was previously managed by Mardef.
The company announced in a statement on Tuesday, that the merger has necessitated the functional review and said currently it was seeking proposals from consultants on the process.
The company in a public notice said this week the soon to be established company will become Malawi’s biggest microfinance institution and announced it would soon apply for registration with the Reserve Bank of Malawi once the review process is finalised.
“Medf Ltd will manage portfolios and operations of the erstwhile Malawi Rural Development Fund (Mardef), the Youth Enterprise Development Fund (Yedf), the Farm Input Loan Programme (Filp) and the newly established Economic Empowerment Trust Fund of Malawi (E-Fund), and will be one of the biggest microfinance institutions in Malawi in terms of product portfolio and outreach,” said the company.
According to the company, the move to establish an independent company was aimed at ensuring “recapitalisation for the future sustainability” adding the move would strengthen the company’s mandate.
The company would operate as a non-deposit taking microfinance institution under the country’s Microfinance Act.
The outgoing Mardef was established by Malawi government in 2005 by late president Bingu wa Mutharika as a project under the ministry of finance with objective of managing loans to the country’s poor and later the Yedf component was added into the portfolio to specifically cater the youth.