Misconceptions Surround High Interest Rates and Low Bank Credit to MSMEs in Zambia

"The important contribution made by MSMEs in the development of any economy cannot be overlooked. In Zambia, MSMEs contribute about 56% of the total number of jobs and account for over 80% of the number of businesses registered at the Patents and Companies Registration Agency. MSMEs also present an avenue for transforming the economy away from its dependence on mining to high value addition and other sectors which could enhance the economy’s resilience and increase its sources of economic growth. The study points to a very important policy matter based on the evidence gathered. There is urgent need to enhance or perhaps create additional institutions with a mandate to cement ties between banks and MSMEs."