Business and Financial Analysts Blessings Kafwanka has noted with concern that the increase in non-performing loans in Zambia has severe impact on investment more especially in the banking sector.

Mr. Kafwanka tells Money FM News via telephone that the increase in non-performing loans is a clear sign that business environment in Zambia is not favorable.

Mr. Kafwanka states that the increase in non-performing loans has also repercussion effects on the growth of the economy as it affects investment opportunities.

He says this also sends a wrong signal to the investors wishing to invest in the banking sector and hence the need to address this issue.

Mr. Kafwanka is strongly advising the government to ensure that it pays attention to the factors that are leading to the increase in non-performing loans.

And the Business and Financial Analysts has praised the Bank of Zambia for maintaining the Monitory Policy rate at 9.75 percent saying this will ensure that interest rates remain at the same level.

“The challenge we have in Zambia is that interest rates are high and this affects business and you realize that any adjustment upwards, would have resulted in increase in lending rates”, he added.

Mr. Kafwanka is of the view that the Central Bank has done an important thing to maintain the monitory policy rate saying this will improve liquidity.