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DEBT SWAP BONANZA

By ADRIAN MWANZA

THE Treasury has released K255.3 million to clear 17 banks and micro-finance institutions as a way of servicing the outstanding loans

civil servants have accrued and to signify the start of the ongoing debt restructuring.

Government released K200 million as third-party payments to micro-finance institutions for March and April 2021 in respect of civil servants’ salary-backed loans, and a further K55.3 million targeted at clearing third-party obligations to commercial banks up to June 2021.

This development was announced when Accountant General KennedyMusonda, Permanent Secretary at Public Service Management Division (PSMD) Boniface Chimbwali and Permanent Secretary for Information and Broadcasting Services Amos Mulupenga held a virtual meeting with commercial banks and other financial institutions to liaise on the implementation of the civil service debt swap initiative.

Zambia National Union of Teachers (ZNUT) general secretary Newman Bubala represented the 15 sector unions in the country.

Mr Musonda said the data reconciliation exercise for the civil service debt swap initiative would take three months, effective July 2021.

Mr Musonda however instructed all the banks and lending institutions to not extend salary-backed loans to civil servants until the reconciliation process was done.

The parties to the meeting agreed to continue the consultative spirit to ensure mutual satisfaction in the implementation of the initiative.

The institutions that were part of the virtual meeting included ABSA, Access Bank, Atlas Mara, Bayport, Eco Bank, Goodfellow Finance,

Indo-Zambia, Investust, Izwe Loans, Madison Finance, NATSAVE, Public Service Micro Finance, Stanbic, Stanchart, Totengram, Zambia National Building Society and Zanaco.

Government introduced the debt restructuring and debt swap which would see all the civil servants have their debts from financial institutions cleared by the Public Service Micro Finance.

According to Government spokesperson Amos Malupenga, the swap would see employees that the government owed money in terms of leave days and other allowances have their debts cleared by Government to ease the pressure since their salaries were not that much.

Earlier, Mr Malupenga clarified that contrary to speculations, civil servants’ salaries have not yet been paid and any deductions effected by banks would be refunded following the implementation of a debt swap by Government.

Mr Malupenga told Millennium Radio during a special programme that stories of banks deducting from civil servants’ salaries for the July pay would be rectified.

“It is just that the process came to fruition coinciding with the elections and people think that it is a political move when in actual sense it is not,” he said.

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