Malawi central bank offers relief COVID-19 packages to commercial bank, reduces mobile payments charges by 40%

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The Reserve Bank of Malawi (RBM) in conjunction with Bankers Association of Malawi (BAM) has announced measures to mitigate the impact of COVID-19.

The central bank and the banking industry agreed a numbers of measures including commercial bank to immediately provide a three-month moratorium on interest and principal repayments for loans by borrowers on the case by case basis.

This means for the next three months, borrowers will be at liberty to pay loans at their own will without penalties or charges incurred for paying loans late.

The commercial banks have reduced mobile payments and internet banking by 40 percent in order to encourage usage of electronic payment transactions.

Banks defer all payments of bonuses and dividends until the risk of COVID-19 is under control which Registrar of Financial Institutions will assess case by case basis.

RBM Governor Dr. Dalitso Kabambe told the news conference in the capital Lilongwe that the measures are immediately effective from April 9, 2020 midnight.

Dr. Kabambe disclosed that Registrar of Financial Institutions will grant relief to commercial banks on the provision of restructured loans and loans on moratorium or suspension impacted by COVID-19.

“Registrar of Financial Institutions has reduced the Liquidity Reserves Requirement (LRR) on domestic current deposits; thereby releasing MK12 billion as addition liquidity availed to banks to directly support borrowers that are distressed as result by COVID-19.

“The Registrar has also reduced Lombard Rate margin by 50% to reduce the cost of accessing funds from the central bank and enable banks to pass on the benefits to borrowers,” says Dr Kabambe.

The Governor assured the nation that the central bank will monitor commercial banks activities that citizens are benefiting from the package.

Malawi has now registered 16 cases of corona virus.

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Edgar Naitha
Reporter|| Music Promotor|| Videographer Email: info@faceofmalawi.com

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