By Phillip Chichoni
On 24 February 2015, AfriAsia Bank Zimbabwe, formerly known as Kingdom Bank, had its licence cancelled by the Reserve Bank. This marked the end of an era for a business built by iconic banker and entrepreneur Nigel Chanakira.
The reason for the cancellation of the licence was cited as that “the banking institution is no longer in a safe and sound condition in that the institution is grossly undercapitalised and is facing chronic liquidity challenges.”
For several months, the bank’s customers were struggling to withdraw their deposits from Kingdom Bank. What went wrong at one of the most successful financial institutions built by a black Zimbabwean?
We are living in the most challenging times for business. The game is survival of the fittest. If you run a business you don’t have a choice but to commit yourself to winning and conquering against all odds. This means making sure that you never run out of cash.
Cash is like the blood of a business. Once cash flows start to deteriorate, like a person losing blood, you know the end is near.
The lesson we learn from the collapse of Kingdom is that, no matter how successful you have been, no matter how big a company grows, if it runs out of cash it will collapse.
In this month’s BusinessLink magazine, we share tips from experts on how to not only survive, but actually thrive in the current liquidity crisis. We give you advice on how to improve cash flows and avoid running out of cash.
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