ExpressCredit Zambia loans suspended from Mintos Primary and Secondary Markets

30.04.2020

mintosblog

Due to failure to ensure that settlement payments to Mintos investors are being made on time, a decision has been made to suspend the loans originated by the lending company ExpressCredit Zambia on Mintos Primary and Secondary Markets. The suspension is effective immediately until further notice. 

ExpressCredit Zambia failed to transfer borrower repayments and the buyback price in full and on time, resulting in accumulated pending payments of € 648 212 outstanding to Mintos investors.

The failure of ExpressCredit Zambia to settle their obligations on time is linked to the delay in disbursements of government collections by the Payroll Management and Establishment Control (PMEC) to ExpressCredit Zambia, whereas whilst the payments have been collected from the borrowers before they received their salaries, the PMEC is behind the schedule in transferring these funds to ExpressCredit Zambia. Up to now ExpressCredit Zambia has absorbed the delay and tried to ensure that, regardless of the delays, payments are being made to Mintos investors in a timely manner. Currently the delay spans 4-5 months, mirroring the same trends across the industry.

The Expresscredit Zambia management team has so far worked collectively together to find a solution that will be in the best interest of Mintos investors

ExpressCredit group is operating also in Botswana and Namibia and whilst the situation with ExpressCredit Zambia has deteriorated in the last few weeks the Botswana market has remained untouched by the global impact of Covid-19 and hence the repayments are up to date.  Even though ExpressCredit Namibia borrower’s repayments have slightly slowed down it is in line with a Covid-19 partial lockdown imposed by the Namibian government to ensure that the pandemic is under control at very early stages of its development.

Mintos is working on restructuring the outstanding payment to ensure that ExpressCredit Namibia transfers its currently outstanding repayments and buybacks as per schedule. It has been agreed that the company will fully cover its overdue payments within upcoming weeks. 

At this point, ExpressCredit has been placed on ratings watch as we consider the possibility of a Mintos Rating change for ExpressCredit Zambia and Namibia. Resolution of the ratings watch depends on the company’s ability to address its liquidity constraints under the current market conditions in both countries. 

About Expresscredit

Expresscredit is a group of lending companies operating in Zambia, Namibia, and Botswana. It was founded in 2015. The current amount of ExpressCredit loans outstanding on Mintos is € 21.34 million. There are 86 618 investors with active investments in Expresscredit loans, with the average investment per investor being € 246.37. The current amount of pending payments from Expresscredit Zambia and Namibia is € 1.29 million.

About Suspensions

Suspension of a particular lending company occurs when Mintos intervenes in the Market – Primary, Secondary, or both – to stop investing due to concerns about a company’s operations. Once suspended, new investments cannot occur until the suspension is lifted or lapses. When both Markets are suspended, this is intended to protect investors’ interests by preventing investments in new loans on the Primary Market, or the sale of existing loans issued by Expresscredit Zambia on the Secondary Market. 

There will be more ExpressCredit updates to follow as soon as we have further information. 

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