* Financiers fear new law will run them out of business
Government through the Non-Bank Financial Institutions Regulatory Authority (NBFIRA) has ordered micro-lenders and cash loan operators to submit loan book values in order for them to be levied, a development the latter fears will run them out of business.
Melville Brown, NBFIRA deputy chief executive officer, Regulatory, issued a statement last week requesting that loan book values be submitted on a monthly basis. "This letter is to give notice to all non-bank financial institutions that are regulated and supervised by the Non-Bank Financial Institutions Regulatory Authority (NBFIRA), as provided for in the NBFIRA Act of 2006 that the regulations authorising the collection of annual licensing fees and scheduled supervisory levies for all regulated non-bank financial institutions' operations have now been approved and published in the Government Gazette of February 17, 2012," stated Brown in the statement. Consistent with Section 51 of the NBFIRA Act, Brown stated that micro-lenders and cash loan operators are requested to submit loan book values between the periods of February 28, 2010 to December 31, 2011.
"The figures will be used as a basis of invoicing regulatory fees and levies. This will also assist NBFIRA in better understanding the operations and performance of all the non-bank financial institutions," Brown said. He said all micro-lenders are advised to complete this exercise as soon as possible as after June 30 this year, NBFIRA will begin to impose sanctions on those found to
"Please note that all information should be submitted within fourteen days (from May 7, 2012). Going forward, monthly information should be submitted by the 20th of the following month," stated the deputy CEO. Micro-lenders and cash loan operators who spoke on condition of anonymity said the development would affect their business immensely as the law is being applied retrospectively."This situation has the potential of disrupting our business performance. How are we expected to be levied for a period when the law was not in force? NBFIRA's main purpose here is to kill our business," argued one micro-lender.
Another said the sole purpose of one venturing into a business is to make profit but with the levies micro-lenders are expected to pay, they will not realise any proceeds. "What we are expected to submit is just too much. It is becoming unprofitable for one to operate a cash loan anymore," complained one dejected cash loan operator.Some have complained that NBFIRA does not give them a notice. They charged that the NBFIRA slaps them with directives week in week out.
Another micro-lender expressed that authorities in Botswana do not recognise the role played by the micro-lending industry in the country's economy. "The development will cause chaos. Some business people will be forced out of business due to lack of funds. The development is ill-timed," lamented another cash loan operator.