First Merchant Bank has reduced its base lending rate from 19.5 percent to 18.5 percent with effect from February 8.

This means the bank is now the most competitive lending financial institution on the market in terms of interest charged on loans.

Indigenous Business persons Association of Malawi (IBAM) has hailed the move saying it would help local traders have access to cheap loans.

"Although at that rate[18.5 percent]the rate is still higher, we feel what the bank has done is a move in the right direction and other commercial banks should emulate the good example set by the bank," said IBAM member Mike Mlombwa.

He said most local Malawians were failing to expand their businesses because of the high cost of finance which he said was uncompetitive in the region.

"In other countries in the region [Sadc] the base lending rate is in single digit but here we have problems with our banks," he said.

The reduction leaves National Bank of Malawi (NBM) at 19.5 percent, Standard Bank at 19.75 percent NBS bank at 19 percent, Indebank at 19.5 percent base lending rate.

<< BACK TO NEWS PAGE