A Zambian friend, Henry, sent me an email yesterday to my question as to what the loan interest rates in Zambia were if the loan was in the local currency, the Kwacha. Here’s his answer:

“Believe it! It’s actually 28% as of today. This is the figure I was given at Stanbic (bank in Zambia) for my facility.
It’s as a result of the Kwacha downfall.
Kind regards.
H”

Larger farmers and businessmen work with the US dollar. Interest rates for US dollar loans are around 12 per cent. It’s still high, but manageable. The small farmer and a good part of the emerging farmer sector don’t have the ability to work with US dollars. Besides the fact that most banks are reluctant to lend to black Zambian farmers, the Kwacha interest rates make a loan very uninteresting.
Just one of the many reasons Zambian small farmers have a difficult time moving forward.