By Wednesday this week, some commercial banks had raised their reference rates by at least 1%, as revealed in statements by NBS Bank, FDH Bank, National Bank of Malawi and Ecobank.

The development will see the respective banks’ borrowers paying 1% more in interest on their loans following the increase in reference rates. On the other hand, the Malawi Confederation of Chambers of Commerce and Industry (MCCCI) said it expects an increase in domestic borrowing fueled by unexpected expenditures on Coronavirus.

The MCCCI first Quarter Economic Report also attributed the forecast to the upcoming elections which are dated to happen on July 2. The report outlines that besides the two factors, Malawi’s public domestic debt stock has surpassed that of external debt, a development which is increasing the risk of public debt distress.