Only Two Micro-finance Institutions are Compliant
The RBZ set December 31, 2022 as the deadline for DTMFIs to comply with the new minimum capital requirement of US$5 million.
ONLY two out of the seven operational deposit-taking microfinance institutions (DTMFIs) have complied with the US$5 million regulatory capital requirement set by the central bank, a new report reveals.
The Reserve Bank of Zimbabwe (RBZ) set December 31, 2022 as the deadline for DTMFIs to comply with the new minimum capital requirement of Zimbabwe dollar equivalent to US$5 million.
But a new report compiled by the apex bank reveals that only two out of the seven micro-financials had complied with the requirement, forcing the RBZ to extend the date to December 31, 2023.
“Core capital for deposit taking micro-finance institutions increased by 16,71% from US$9,93 billion as at 30 September 2022 to US$11,59 billion.
“Two out of the seven operational deposit-taking micro-finance institutions complied with the new minimum capital requirement of ZW$ equivalent to US$5 million effective 31 December 2022.
“Compliance with the minimum capital requirements by non-compliant deposit-taking micro-finance institutions was extended by a further 12 months to December 31 2023, to allow for completion of the recapitalisation processes currently underway.
“The bank continues to monitor progress towards compliance with both minimum capital requirements and economic capital to facilitate underwriting of more meaningful business.”
The report noted that non-compliant institutions were at various stages of implementing measures to raise their capital levels.
In the period under review, total deposits for DTMFIs increased by 83,27% to $6,23 billion. The growth in deposits, the report notes, was mainly driven by foreign currency deposits of US$6,75 million, equivalent to $4,64 billion, which accounted for 74,47% of total subsector deposits.
The subsector’s prudential liquidity ratio increased to 189,52% due to increased deposit levels. In the quarter under review, there were 206 registered.
