Establishment of mineral trading hubs has played crucial

25Sep 2020
The Guardian
Establishment of mineral trading hubs has played crucial

THE government has said the establishment of mineral trading hubs across the country has been one of the key ways to speed up loan provisions to artisanal miners while commending NBC Bank for its commitment to support the group through business management trainings and loan opportunities.

Jonathan Bitabaje (R), NBC Bank’s products and banking services manager, addresses mining stakeholders from Lake Victoria Zone regions yesterday at an Investment and Business Opportunity Forum held as part of the ongoing Geita Mining and Technology Exhibition. Photo: Guardian Correspondent

Speaking at the Investment and Business Opportunity Forum held at the ongoing Geita Mining and Technology Exhibition, Permanent Secretary Ministry of Minerals Prof Simon Msanjila said through the mineral markets the artisanal miners sell minerals openly with their business records kept properly hence an opportunity for financial institutions in the country to use the records as one of the major tools towards loans issuance to the miners.

“The available business records for each small- scale miner in our mineral markets will greatly help our financial institutions including NBC Bank which has expressed interest in helping the group to now issue loans especially after the trainings,’’ he said.

Further, Prof Msanjila called on all mines in the country to ensure that they bank with financial institutions in the country as well as cooperating with the institutions by providing proper legal contracts to their suppliers so that the same contracts could be used by the suppliers to apply for loans from the financial institutions.

“If suppliers get financial supports from the financial institutions such as NBC Bank it will also be beneficial for the mines as the suppliers will be able to have the financial capacity that will enable them to handle their responsibilities effectively and at acceptable quality,’’ he added.

Geita Regional Commissioner Eng Robert Gabriel said the move by financial institutions to start issuing loans to small scale miners is a good indication of the economic transformation of the miners and the government as a whole as through such loans miners would increase their operation capital at the same time applying the knowledge they got during the training to operate effectively and at standards.

“A good example is the training provided by NBC bank to small-scale miners and SMEs. In other words, the beneficiaries will not only be financially empowered but also have a good understanding of how to carry out their activities, '' said Engineer Gabriel, while also urging financial institutions to conduct a thorough risk analysis during the process.

Speaking during the forum, NBC’s Products and Banking Services Manager, Jonathan Bitabaje also called on the government to give more pressure to the large mines in the country to ensure they cooperate with the financial institutions by providing legal contracts to their service providers to make it easier for the lenders to use the same contract as collateral for loans to the service providers.

"At NBC Bank we issue unsecured loans to distributors and suppliers of large companies but all we need is the 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.

Bitababaje commended the government for the establishment of mineral markets in the country, noting that in addition to helping small-scale miners in doing their business, the presence of these markets also formalises the financial records of the miners.

Top Stories