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Extending US loans to businesses in Zimbabwe

Bankers Association of Zimbabwe (BAZ) says the sector has recorded an increase in local currency loans after the central bank lowered interest rates. However, Banks do risk profiling and due diligence when extending USD loans to businesses. In general banks lend USD loans to clients who have capacity to generate USD revenues and as mentioned earlier, they also look at the margins the applicant is able to achieve with a view on repayment of the loan. What is the biggest risk to observe when giving loans to businesses ?

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