Malawi Microfinance Network (MFN) has advised Malawians to take advantage of the formal credit opportunities whenever they want to access loans.
MFN executive director Duncan Phulusa said this on Friday at Malawi Housing Corporation (MHC) in Mzuzu on the sidelines of a Credit Awareness Week event.
The Credit Awareness Week, which ended on Friday, was organised by the Reserve Bank of Malawi (RBM) against a backdrop of figures from the central bank showing that only three percent of Malawi’s adult population have access to credit.
Said Phulusa: “We would also like to ask those interested in accessing loans to read and understand all the terms and conditions which most of the times come in small prints before appending their signatures on loan agreement documents.”
He said many people rush through the process before understanding issues such as processing fees and administration charges.
Phulusa further advised those interested in accessing loans to compare charges of different financial institutions, including interest rates.
One of the participants at the MHC session, Lexa Boti, said the presentation taught her to first appreciate the terms and conditions before committing to a loan.
Speaking when he launched the week in Blantyre last Monday, RBM Governor Dalitso Kabambe observed that despite the private sector growing, access to credit from formal financial services by Malawians is minimal.
The Credit Awareness Week sought to establish the merits of accessing and borrowing money from licensed or registered lending institutions, including banks, microfinance institutions and savings and credit cooperatives as opposed to borrowing from informal lending institutions.