CHOMBA MUSIKA, Choma
WATER utility companies have been experiencing challenges in mobilising funds, especially lease finance, because banks deem their balance sheets as weak, Southern Water and Sewerage Company(SWASCO) board chairperson Anne Tischer has revealed.
Ms Tischer observed that several financial institutions avoid leasing assets to water utility companies owing to perceived weak balance sheets, a development which she said had hampered SWASCOâ€™s quest to acquire utility vehicles on a lease agreement.
She was speaking in Choma on Thursday when Investrust bank handed over nine Ford Ranger vehicles and 25 three-wheeler motorcycles worth K3million to the Southern Water and Sewerage Company (SWASCO).
The bank financed the K3million lease through its InvestLease product facility.
â€œManagement is delighted that the long and difficult journey we embarked on towards acquiring reliable transport for the company has finally come to fruitionâ€¦It is a well-known fact that mobilising finance, especially lease financing, is not an easy assignment for water utilities in Zambia whose balance sheets are considered very weak,â€ Ms Tischer said at the event graced by Southern Province minister Nathaniel Mubukwanu.
She applauded the bank for the gesture, which she said would avert the transport challenges the water utility company has been facing.
â€œTransport cost for us is a major input cost into our production because we are spread across the province hence having reliable transport is a sure way of managing our costs, especially those related to transportation,â€ Ms Tischer said.
And Investrust managing director Richard Chembe said the lease was aimed at complementing the water utilityâ€™s quest to deliver good quality water to the community.
Dr Chembe also explained that the InvestLease product is a facility where the bank acquires assets on behalf of its customers and avails the assets under a lease agreement to be paid over a period of time.
And Mr Mubukwanu said he was confident the utility vehicles will enhance SWASCOâ€™s capacity to deliver quality services to its customers.
He also urged small and medium scale entrepreneurs to take advantage of financial products like the InvestLeast product, which can help them revamp their businesses.
CHOMBA MUSIKA, Choma