Agribank has suspended its salary-backed loan facility for government employees following the termination of services with Avril Payment Solutions (APS), while existing loans remain unaffected.
This follows an announcement by the Ministry of Finance on the termination of APS’ services.
This means no new personal loans for government employees would be processed through the APS platform.
Agribank chief executive Raphael Karuaihe in a statement on Wednesday says existing loans remain unaffected and will continue to be administered by the finance department until they are fully settled.
“The salary-backed loan scheme was introduced to enhance financial inclusion for farmers without collateral and to promote agricultural activities in both communal and commercial areas,” he says.
The chief executive says the scheme caters to salaried part-time commercial and communal farmers, as well as agribusiness ventures, by providing access to finance with repayments effected through payroll deduction.
“Agribank remains committed to offering innovative, tailor-made financial solutions at competitive rates to meet funding needs of the diverse segment of the agriculture sector and its related value chains,” he says.
Last week, Letshego Holdings Namibia also announced it would no longer issue government employees new deductions at source loans.
Letshego said instead, all new micro-lending loans will now be paid back through debit order arrangements and will be subject to credit affordability checks.
