ZIMBABWE Women’s Microfinance Bank (ZWMB) is caught in a series of grave administrative challenges which have seen the bank running without key risk managerial personnel for the past year in a blatant breach of risk management principles, it has emerged.
The bank has been operating without a risk officer as well as a compliance officer as well as the absence of non-executive board members in some of its committees.
This comes after parliamentarians last week raised a red flag over the banks’ modus operandi in disbursing loans saying the bank was sidelining the vulnerable and marginalised women in favour of the elite.
Risk management is the process of identifying, assessing and controlling threats to an organisation's capital and earnings and in its absence, an organisation faces the risk of unexpected, harmful events that can cost money.
Last month the Reserve Bank of Zimbabwe (RBZ) flagged the bank for corporate governance and risk management weaknesses.
However, last week the bank’s chief executive officer Mandas Marikanda confirmed to the Independent that the bank was mired in a chain of controversies which needed immediate attention.
“They came and did an inspection and there were three things that they picked. These are: risk management, corporate governance and capitalisation. Every bank is expected to run with key positions. We have 10 heads of departments and one of them is the head of risk and head of compliance.
“The bank has been running without these two. We were having challenges hiring them. It has taken us over a year. It's a red flag because wherever we give out a loan, the risk officer is supposed to look at it . The other one is compliance. This one looks at laws and rules. If we change anything, he is supposed to look at it,” Marikanda said.
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On corporate governance, Marikanda said ideally the banks’ board should have nine people but the board only has six.
“The board is well constituted but not committees. We have a committee on loan reviews. Each committee is expected to have three non-executive members in there. So if the board has few people, the central bank takes it seriously,” she said.
The bank is also caught in another scandal where women representatives are accusing it of duping vulnerable women through purported loan schemes.
Women who spoke to the bank last week accused the bank of preying on unsuspecting vulnerable women in various communities saying the schemes have seen thousands of women parting with their hard-earned cash but getting nothing in return.
The Independent understands that in the past two years, the bank through its agents mobilised over 10 000 women in Chitungwiza alone promising to give them loans once they open accounts with the bank.
The women paid US$5 each to activate their accounts, however, two years later they have not secured loans from the bank.
Chitungwiza Residents Trust member Alice Guvheya said she was living in fear as the residents are putting pressure on her.
“We were promised loans. The Women’s Bank agents came to Chitungwiza and we mobilised women. We paid $5 for accounts opening and we were told we were going to be given money for women economic empowerment. To date nothing has come.
“This is tarnishing our image as community leaders responsible for mobilising people. The women are over 10 000 and it’s a lot of money,” Guvheya said.
Member of the women's parliamentary caucus Perseverance Zhou said there was a need for transparency on the bank’s part when it comes to loan disbursements.
“I was on the ground mobilising people for the loans. I mobilised over 1800 women in Kwekwe and Gweru. We are not sure who got the loans,” she said
But Marikanda said opening accounts was to enable the women to apply for loans.
