SMALL Entrepreneurs Loans Fund (SELF) project has issued a total of 122.9bn/- soft loans to petty traders and small and medium sized entrepreneurs (SMEs) since 2000 when it was set up through the African Development Fund (ADF) support.
It channelled the funds through 495 Saccos and community banks spread across the country.
The SELF Microfinance Fund Managing Director, Mudith Cheyo told the ‘Daily News’ in an exclusive interview over the weekend that the project managed to support the rural poor people through a win-win cooperation with community banks, Saccos and community based financial institutions (CBFIs).
“We were able to deliver financial soft credits to the petty traders, small and medium entrepreneurs in several economic activities such as farming and food processing sectors by signing contracts with 495 Saccos and community banks all over the country,” he said.
286 Saccos, about 57 per cent are rural based, benefitted a total of 132,578 entrepreneurs whereby 74,517 were women with the remaining 58,061 about 42 per cent were men.
He said 39.7 per cent of beneficiaries were petty traders running restaurants and food cafes, education and transportation while peasants and livestock keepers accounted for a 41 per cent with 17.1 per cent covered by value addition chain entrepreneurs in the agro and livestock value chain.
On job creation, Cheyo revealed that through the 122.9bn/-valued loans disbursed to petty, small and medium entrepreneurs, the cash boost created about 350,000 jobs through self employment for beneficiaries and some of those secured employment in businesses which received SELF Microfinance Fund loans.
“One may realise how beneficial the decision by retired president Benjamin Mkapa administration to ask for a 8m US dollars credit from the African Development Fund (ADF) a subsidiary of the African Development Bank (AfDB). It was this amount of money that was used to launch the SELF project in 2000,” he said.
As a multiplier effect to the 122.9bn/- loans issued, a total of one million entrepreneurs directly or indirectly benefited from the SELF Microfinance Fund issued loans.
“SELF Microfinance Fund besides extending soft loans to Saccos, Community Banks, private money lenders etc the Fund is mandated with the role of offering specialised training to both Saccos’ elected and employed officials, ordinary members and shareholders of community banks.
Between 2000 through 2018 the Fund trained 11,948 entrepreneurs from Saccos who later loaned from their respective credit or savings entities in their localities,” further revealed the SELF Microfinance Fund Managing Director.
Regarding the SELF Fund performance especially in expanding and protecting public money entrusted to SELF from Non Performing Loans (NPLs), Cheyo said the seed money secured by the government from the ADF was safe and secure as SELF Microfinance Fund loans repayment record stands tall at 92 per cent.
“An open threat to any financial institution is wasting money through NPLs which to me is a result of poor scrutinisation of the client’s both financial position and money management skills in addition to either collusion between a lending institution staff and clients.
At SELF Microfinance Fund we are very strict when it comes to sticking to professionalism, honesty and high degree of discipline. Through the three key pillars we have restricted NPLs to below 10 per cent which is professionally acknowledgeable,” observed Cheyo.
On reaching out to Tanzanians across the country, the SELF Microfinance Fund boss said presently they offer services through four zonal offices located in Dar es Salaam (East Z one), Mbeya (Southern Highlands), Mwanza for Lake Z one in addition to Kahama satellite centre and the Arusha based zonal office covering the north zone.
“With such a national spread we are sure to be well placed to serve a majority of those in need of financial credits yet qualify for the loans particularly among petty traders, small and medium sized enterprises.
So far our zonal offices have proved useful as several Saccos and community banks’ officials secured loans with no red tape and a string of conditions,” he said.