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CBZ mining loan book soars

“We have established partnerships with several leading mining houses and their suppliers. Significant progress has been made in facilitating these linkages and we continue to engage other players, signing memorandum of understanding under the ESD, which is enterprise supplier development financing structure."

FINANCIAL services giant CBZ Holdings’ mining sector loan book has more than doubled to 18%, a demonstration of the bank’s commitment to support Zimbabwe’s economic growth, an executive has said.

CBZ Holdings executive director, Phibeon Mutibura, told Chamber of Mines of Zimbabwe 2024 annual conference held in Victoria Falls recently that the group and its subsidiaries have continued to offer a leaning shoulder to the mining sector in particular and the whole economy in general.

“Out of our understanding of the unique and often complex nature of the mining sector and our belief that harnessing mineral resources in a sustainable manner can uplift entire communities and economies, we have created a wide range of stellar financial solutions for the industry, including its value chains, Mutibura said.

“As a testimony to this, CBZ mining sector loan book has grown significantly from about 7% in 2021 to current levels of 18%.”

In a bid to ensure financial inclusion, CBZ introduced the value chain and local enterprise development financial solution. The solution leverages non-traditional bank lending methods to provide financing to local enterprises, value chain suppliers within the mining industry.

“The emphasis here of LED, which is Iocal enterprise development, is on creating commercial linkages between SMEs [small and medium enterprises], the supplier, and the mining companies. As CBZ, we are also playing our part to make sure that no one and no place is left behind,” Mutibura said.

“We have established partnerships with several leading mining houses and their suppliers. Significant progress has been made in facilitating these linkages and we continue to engage other players, signing memorandum of understanding under the ESD, which is enterprise supplier development financing structure.

“The bank targets SMEs suppliers who are regularly entrusted suppliers for selected mines, who will sign a memorandum of understanding between the bank, the mine, and the supplier. This solution enables small enterprises and established companies to access capital to increase production capacity.”

To be eligible, each supplier must be recommended by a mining company which supplies products and services to that particular mine. The bank finances working capital, short-term loans, capital expenditure, and new equipment, including supporting the manufacturing of industries for the local suppliers.

ESD ensures that SMEs, which traditionally struggle with access to finance due to inadequate collateral, no financial records, or poor credit histories, are empowered.

“This promotes financial inclusion. By capacitating suppliers, Zimbabwean mines can meet their obligations on time, eliminating disruptions in the supply of key materials and equipment, thereby enhancing efficiency,” Mutibura said.

ESD empowers local enterprises, making them more competitive and fostering local job creation and improved livelihoods in the communities in which we operate. It saves the country foreign currency through import substitution, Mutibura said. – (Newsday)

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