By Daily News Reporter in Geita
THE government has said the establishment of mineral exchange hubs across the country is one of the key ways of speeding up loan issuance to artisanal miners as initiated by NBC Bank.
Permanent Secretary in the Ministry of Minerals, Prof Simon Msanjila, said at an investment and business opportunity forum held at the ongoing Geita Mining and Technology Exhibition that through mineral markets artisanal miners sold their minerals openly with their business records kept properly safe.
He said it was an opportunity for financial institutions in the country to use records as one of the major tools towards loan issuance to miners.
"Available business records for every small-scale miner in our mineral markets will greatly help our financial institutions, including NBC Bank, to issue loans especially after training."
"If suppliers get support from financial institutions it will also be beneficial for the mines... as they will be able to have the financial capacity that will enable them discharge their duties effectively," he pointed out.
For his part, Geita Regional Commissioner Robert Gabriel said the move by financial institutions to start issuing loans to small-scale miners was a good indication of economic transformation of the miners' welfare and the government as a whole, adding that through such loans, miners would increase their operational capital at the same time apply the knowledge they got during training to operate effectively.
"A good example is training provided by NBC Bank to small-scale miners and SMEs. In other words, the beneficiaries will not only be financially empowered, but also they will have a good understanding of how to carry out their activities," said Mr Gabriel, while also urged the banks to conduct a thorough risk analysis during the process.
Speaking during the forum, NBC Bank Products and Banking Services Manager Jonathan Bitabaje called upon the government to give more pressure to large mines in the country to ensure they cooperated with financial institutions by providing legal contracts to their service providers to make it easier for lenders to use the same contracts as collateral for loans to service providers.
"At NBC Bank we issue unsecured loans to distributors and suppliers of large companies, but all we need is a legal tender contract to confirm the legitimacy and value of the tender. That is why we politely ask our fellows from the mines to help us in this," he explained.
Mr Bitababaje commended the government for establishing mineral markets in the country, noting that they helped small-scale miners to run their businesses professionally, adding that the presence of the markets also formalised financial records of the miners.
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