Opposition finance spokesman Charles Mangion yesterday complained that banks were charging small businesses “hefty administrative charges”, and urged the MFSA to see whether these were justified.
Dr Mangion said that when businessmen closed an account, they were charged up to €300. SMEs were also required to pay around five per cent of the credit facility when renewing such a facility. Moreover, they were asked to pay €1,000 when they asked for a collateral property to be released.
Credit institutions could not inflict these types of administrative costs, he said. The MFSA should analyse whether such bank charges were justified. While banks should safeguard their interests, they should not only look at profits but also see how profits were made.
Dr Mangion said that in a private meeting which the opposition had had with SMEs, the businessmen had also mentioned that banks were making it difficult to extend credits. While banks needed to be cautious when lending money for construction, small businesses depended on banks when borrowing funds. Micro-credit schemes had still not been developed. Innovation and encouraging people to be innovative also depended on credit facilities.
Facilitating credit facilities on a legislative level was a good thing, he said.
Referring to the MFSA investigation into the La Valette Management Fund, he said there should not be any pressure because this needed to be a comprehensive exercise. At the same time, the Bank of Valletta should retain its credibility.
Speaking earlier on the IMF motion, Dr Mangion said that the IMF’s importance was evident in circumstances where countries, even EU member states, suffered from financial problems.
He praised the IMF “Voice and Participation Motion” for its good timing. Countries’ participation should reflect their economic development. The US and certain European states still dominated the IMF; the former could even block certain measures.
One should consider the Far East economies, such as China’s whose economy kept increasing by between nine and 12 per cent. Their economic position should therefore be reflected in the IMF, which was an institution that should develop through the passage of time. Far East countries were also extending their economic strength outside their territories. China had invested in the African continent. India’s economy was also developing at a fast pace, and this should also be reflected in the IMF.
In endorsing the proposed changes, Dr Mangion said that Malta’s participation level would not be affected. Every good measure that was implemented would put the IMF in a better position to fulfil its mission when needed. The IMF had also intervened in the Greek case, where problems had been created due to bad decisions taken.
Dr Mangion welcomed the enlarging of the investment authority within the IMF.
The motion was unanimously approved.