Small-loan scheme to combat poverty

President Bingu wa Mutharika has launched a US $9.3 million small-loan scheme - one of his key election pledges - in a bid to tackle rural poverty. "I promised the people of this country the loan, and I have fulfilled this promise," Mutharika said in response to political sniping over the delay in rolling out the programme. "My enemy in Malawi is poverty," he told a rally this week in Mangochi, in the south of the country. "We will teach you how to do business and empower you economically." The loan scheme, administered by the Malawi Rural Development Fund, will not only provide business grants but also training to would-be entrepreneurs. Mutharika said the programme would favour projects involving women and youth. No collateral is needed to access the loans, and individual applications are only accepted through a local collective, which will be responsible for ensuring repayments - all members of the group are denied new loans if one defaults. Malawi is one of Africa's poorest countries, with around 70 percent of its people living in poverty. Mutharika, who was elected to power in May 2004, has pledged to tackle corruption and improve the standard of living.