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Walter Mswazie in Masvingo
MICRO finance companies have come under fire for allegedly deducting money from clients without prior-agreement amid calls for them to observe business ethics.

Most civil servants, who constitute a larger fraction of micro-finance companies’ clients, have complained that their monies were being deducted through the Salary Service Bureau, without their consent.

This, they said, has made their lives difficult, as some are now getting as little as $10 per month, after unsanctioned deductions.

Mrs Tsitsi Moyo, a teacher from Chivhu, said she joined one micro-finance company in Masvingo, after getting a place to study with the local university but was now regretting as the company now, “empties” her account every month.

She said this was despite the fact that the two parties had agreed on a $50 deduction per month.

“I joined this micro-finance company in Masvingo after I was offered a place to study a degree with a local university.

“I applied for a loan of $2 400 towards my fees and I was supposed to make a repayment of $100 per month but they were deducting almost 99 percent of my salary every month,” said Ms Moyo.

Another civil servant from Bikita, Mr Trainos Chakari said he was seeking a legal recourse, to recover the money he lost through unsanctioned deductions by a money lending company in Masvingo.

“I am contemplating seeking legal assistance to recover my money. I did apply for a loan sometime in 2013 and successfully serviced it within two years but up to now, the company is deducting money from my account.

“I have approached them on several occasions but it seems I will not get any respite despite the personnel’s assurance. The company continues to make unsanctioned deductions from my account and to date $5 000 has since been taken,” said Mr Chakari.

Zimbabwe Association of Micro Finance Institutions (ZAMFI), executive director Mr Godfrey Chitambo said it was illegal for micro-finance companies to make unsanctioned deductions from clients, as this was against the spirit of good business ethics.

“We do not expect micro-finance companies to violate business ethics through duping their clients. They should only deduct agreed figures and when the loan is serviced there is no need of punishing clients,” said Mr Chitambo.

He, however, said some deductions were a result of the errors by the bank not necessarily the company.

Micro-finance companies are expected to follow micro-finance laws and guidelines by the Reserve Bank of Zimbabwe. Thousands of unsuspecting investors lost more than $3 million in 2013 to Masvingo money pyramids, which include, McDowels International and All Angles International. The latter has since closed down with its owners having fled the country fearing prosecution while McDowells is now under judiciary management.

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