Zemen Bank responded to the questions raised by the floriculture industry by suspending loan interests, which is highly affected by the COVID 19 pandemic outbreak.
Dereje Zebene, president of Zemen, announced that his bank has decided to suspend the loan interest for flower exporters for three months until June 30, which is the last date of the financial year.
He said that the bank is also ready to apply other potential support for the fragile business, which is highly affected due to the major market destinations in Europe closed their doors fearing the pandemic.
“We will also provide a working capital if it is necessary,” Dereje said in a press briefing held on Friday April 3, 2020 at Intercontinental Hotel.
A week ago Prime Minister Abiy Ahmed stated that to encourage banks to consider suspension of loan interest and provide additional facility the government has allocated 15 billion birr from National Bank of Ethiopia, to banks.
Dereje said that besides the horticulture sector other businesses will also get similar support.
“The incomparable difference of the flower sector is it should have run the farms meanwhile it could not export products due to that their operation is severely affected. They are also handling more than 150,000 labour,” the bank president elaborated why the horticulture sector got prior attention.
“We have more than half a billion birr loan portfolio that will give clear picture how much loss we will incur when we suspend the interest rate for the horticulture sector but we don’t want to disclose the amount because it is a solidarity gesture than promotion of the bank,” Dereje told Capital.
He said that the resource of the bank is the public and that resource should support the public on such kind of situations.
Rescheduling loan settlement is also included in the latest decision of the bank, according to the president.
Zemen has also given five million birr to combat the pandemic. “The gift is from everyone to everyone,” the bank said.
The bank has also annulled 75 percent of the extension commission fee in the course of extending the validity of bank services for customers, while the balance is provided for health workers, who fight the virus.
“So far 800,000 birr has been secured from 25 percent commission that will be given for Ministry of Health to use on keeping the safety of health workers who are at the front of the pandemic battle,” Dereje said. He said that providing the earning from the commission will continue until the problem is fully tackled.
The bank has also commenced an initiative to mobilize money from its employees to provide further support.
Currently Zemen provide unlimited transaction via internet banking and allow withdrawing 12,000 birr from ATM.
The bank encourages clients to use such kind of services since it is helpful to keep the physical distancing because of the outbreak.