Dr Mwinyi faults Masterlife Microfinance over illegality

07Apr 2021
By Guardian Reporter
Zanzibar
The Guardian
Dr Mwinyi faults Masterlife Microfinance over illegality

ZANZIBAR government has withheld a total of 4.79bn/- from the owner of Masterlife Microfinance Company for allegedly running financial business illegally.

Zanzibar President Dr Hussein Ali Mwinyi announced this yesterday at the State House when speaking to journalists, noting that through that business, the firm has already received 38.5bn/- from 39,000 people.

Dr Mwinyi said: “I’m aware that since March 4, when the government withheld the money it caused mayhem to the public particularly to people who were in that business and some have started receiving loans from this bank. But, I want to make it clear that the company is being accused of not having valid legal permits of collecting money from the public. ”

President Mwinyi assured the public that their monies were in safe hands and the government was working on the matter.

According to Dr Mwinyi, the company used the registration documents issued in Tanzania mainland by the Business Registrations and Licensing Agency (BRELA) and registered with the Tanzania Revenue Authority in July 2020, where it was placed in the category of small taxpayers and will be involved in animal husbandry business as well as food processing.

He said: “It was shocking to see that the company did not fulfill its responsibilities in terms of registration, instead it was involved in the business of collecting money from the public.”

Dr Mwinyi said after being operational it was found that the Masterlife Company did not have a profitable business, instead, it was circulating the money among its customers.

" Issues like this happens in many countries around the world, including Albania and mainland Tanzania…basically this type of business is bankruptcy from the beginning due to debts being larger than the assets in the system," said President Dr Mwinyi.

He explained that the procedure of increasing the number of members due to the desire to get the maximum benefit given to initial investors and eventually reaches a point where the amount required to be paid to first-time customers is greater than the collections generated by new customers.

Mwinyi urged the people to be vigilant and avoid getting involved in the business of it and the government continues to investigate and monitor companies and institutions involved in irregular businesses that cause economic harm to the government and its citizens.

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