WINDHOEK – Fides Bank Namibia, currently the only micro finance bank in the country, says it will downsize its activities in Katutura as they were too “costly” to develop and have not yielded the expected socio-economic impact on its clientele. The operations also proved to be economically unsustainable.
The bank opened its Katutura branch In November 2012 with the aim to offer financial services to micro entrepreneurs in the area.
“This downsizing of activities in Katutura will improve the sustainability of the bank as a whole and is therefore necessary to safeguard the jobs of employees. [But] it will inevitably require the bank to downsize its task force in this branch. The management of Fides Bank is currently exploring retrenchment options and all other possible avenues to achieve this in the most acceptable way for all parties, in close cooperation with Nafinu (Namibia Financial Institutions Union),” said Karin Everding, the chief executive officer of Fides Bank Namibia.
For Katutura, Fides Bank developed specific loan and savings technologies and built up a portfolio of several thousand micro clients in about one year. “After a little more than one year of practical experience accumulated in the field, the bank has to acknowledge that there is no sustainable space for its financial services offering towards the low-end market of micro entrepreneurs [in Katutura],” remarked Everding. The results have forced Fides Bank’s governing body to decide to withdraw from this market segment in the coming weeks and months and to concentrate its efforts on northern Namibia that is said to be developing well and contributing to putting the bank on track towards financial stability.
Everding noted that the bank has successfully developed unique services for its more than 15 000 clients in the northern regions of Namibia since 2010.
By Staff Reporter