Farmers to face the music
Agribank will for the first time make use of a debt-collecting company to ensure that the N$500 million owed to it by farmers is paid or property will be repossessed.
Agribank Namibia has called in the help of debt collectors to start collecting an outstanding N$500 million in loan repayment from farmers across the country.
The bank has to date disbursed loans to clients to the tune of N$2.4 billion and will for the first time make use of external debt collectors.
The bank's CEO Sakaria Nghikembua announced this at a media briefing on Friday adding that they are not insensitive to the effects of drought but emphasised that clients will have to get their acts together.
He added that the idea is to motivate clients to make arrangements and that it would be unfortunate if it results in legal action that would see a client's property repossessed.
“The sustained high levels of arrears would threaten Agribank's financial sustainability and its ability to deliver on its mandate in the long-term. As part of the arrears collection strategy, the bank has appointed debt collectors to assist it in collecting outstanding repayments from clients with effect from this month,” said Nghikembua.
Nghikembua further stated that despite the challenging operating environment, the bank has maintained credible financial performance in the year so far and expects that it will meet or exceed its key financial targets for the full year to the end of March 2017.
According to the Sakkie Coetzee, executive manager of the Namibia Agricultural Union, this is a very unfortunate time and that he can only hope the bank is successful in collecting its money.
“The truth is the agricultural sector is under a tremendous pressure at the moment, but on the other hand the bank must do what it must to collect money that is owed to it,” he said.
Agricultural expert Wallie Roux has commended this drastic move by the bank although he questioned the timing of the measure.
He also emphasised that clients have owed the institution for several years which makes it difficult for the bank to effectively operate.
“The question however is, how practical is it at this particular time? Farmers will prefer to hold back their livestock to build herds back up again especially now that it has rained,” said Roux.
JEMIMA BEUKES
The bank has to date disbursed loans to clients to the tune of N$2.4 billion and will for the first time make use of external debt collectors.
The bank's CEO Sakaria Nghikembua announced this at a media briefing on Friday adding that they are not insensitive to the effects of drought but emphasised that clients will have to get their acts together.
He added that the idea is to motivate clients to make arrangements and that it would be unfortunate if it results in legal action that would see a client's property repossessed.
“The sustained high levels of arrears would threaten Agribank's financial sustainability and its ability to deliver on its mandate in the long-term. As part of the arrears collection strategy, the bank has appointed debt collectors to assist it in collecting outstanding repayments from clients with effect from this month,” said Nghikembua.
Nghikembua further stated that despite the challenging operating environment, the bank has maintained credible financial performance in the year so far and expects that it will meet or exceed its key financial targets for the full year to the end of March 2017.
According to the Sakkie Coetzee, executive manager of the Namibia Agricultural Union, this is a very unfortunate time and that he can only hope the bank is successful in collecting its money.
“The truth is the agricultural sector is under a tremendous pressure at the moment, but on the other hand the bank must do what it must to collect money that is owed to it,” he said.
Agricultural expert Wallie Roux has commended this drastic move by the bank although he questioned the timing of the measure.
He also emphasised that clients have owed the institution for several years which makes it difficult for the bank to effectively operate.
“The question however is, how practical is it at this particular time? Farmers will prefer to hold back their livestock to build herds back up again especially now that it has rained,” said Roux.
JEMIMA BEUKES
Comments
Namibian Sun
No comments have been left on this article