By DOH JAMES SONKEY
A system of information sharing within microfinance institutions expected to limit over-indebtedness of customers and also significantly reduce the loan delinquency rate in the sector which currently stands at 22.9 per cent, according to statistics from the National Credit Council has been launched.
The newly created system known as Risk Prevention Bureau for Microfinance Institutions (CREMF) was launched last June 21 at the Yaounde Hilton Hotel by Finance Minister, Louis Paul Motaze who doubles as President of the National Credit Council.
The Secretary General of the National Credit Council, Jean Marie Benoit Mani who doubles as National Director of BEAC for Cameroon said that as a brainchild of the Council, CRÈMF is put in place to help microfinance institutions make informed choices with regards to issuing loans to their respective customers because it collects and disseminates information on the worthiness of customers of microfinance institutions.
Speaking at the occasion, Finance Minister, Louis Paul Motaze said every institution will be able to consult the system whenever a customer applies for loans before deciding whether or not to grant the request. Through the system, they will be able to tell whether the customer has unpaid loans in other microfinance institutions and also whether he/she has the potential to reimburse loans within agreed periods.
Minister Louis Paul Motaze added that the initiative will strengthen the financial system by making it secured and efficient.
On his part, the Vice President of the Bank of Central African States (BEAC) Dieudonné Evou Mekou who sees CREMF as a credit policy that would facilitate development and emergency of Cameroon and other countries in Central Africa urged countries in the sub region to emulate the example of Cameroon and use the institutions to reinforce financial stability that would foster economic growth.
In a chat with reporters, the President of the Cameroon Credit Union League (CAMCCUL), Shey Nfor Musa who doubles as President of the National Association of Microfinance Institutions, reassured of their collaboration with CREMF for better results to be attained.
Due to the fact that most microfinance institutions are found in rural areas with little access to internet connectivity needed to use CREMF, Shey Nfor Musa pleaded with Finance Minister to help them in the facilitation of loan recovery because “Our microfinance institutions do not follow classical methods to issue loans in terms of required securities. This makes it difficult for them to recover borrowed money.”