Cabs African Building Society has agreed to relax stringent lending conditions for struggling Zimbabwean companies hard-hit by lack of capital and failing to access the $40 million distressed industries and marginalized areas fund launched last October.
Ntombenhle Moyo, chairwoman of the Bulawayo branch of the Zimbabwe National Chamber of Commerce, said CABS yielded to companies’ pressure to relax some of the terms which had resulted in the shelving of project proposals estimated at $73 million.
According to the Ministry of Industry and Commerce, business proposals worth over $3 million have so far been approved under the rescue fund.
CABS, a subsidiary company of Old Mutual Zimbabwe which provided half of the finance package, was demanding that firms should provide two-year audited financial statements, clean tax records, sound credit ratings and collateral security before accessing the fund.
Moyo said there are high hopes that most distressed companies that have failed to meet the tough credit terms will start accessing the funds.
“It is taking too long for companies to access this fund while most of them are almost collapsing,” she said.
At least 80 companies shutdown in Bulawayo between 2009 and 2010 leaving over 20,000 people jobless.