Cambria Africa Regulatory News (CMB)

8th July 2010

LONZIM PLC

('LonZim' or 'the Company')

LonZim Microfinance company Tradanet makes progress in Zimbabwe

LonZim Plc (AIM:LZM), the London listed Zimbabwe investment company is pleased to announce a trading update for Tradanet, the microfinance division of LonZim's 100% owned subsidiary Paynet Limited. Tradanet, has reported strong growth as a result of the recovering Zimbabwe market. Tradanet has achieved :

·; Over US$ 25 million payroll based microfinance loans issued to twenty two thousand individuals since mid 2009

·; 45 senior companies now use Tradanet to assist employees in accessing salary based microfinance

·; $ 3.5 million in principal and interest payments collected in June 2010

Established in 2005 with a unique approach to payroll based lending, with payments deducted at source, Tradanet provides an outsourced service to financial institutions for supporting small value loans and for employers to automate the administration of internal staff loans.

The business is a low risk, low cost channel for lending small value, high volume microfinance that provides salary based loans and which has delivered a default rate of less than 1%.

Tradanet experienced rapid growth from its inception in 2005 and quickly established a substantial client base processing around 6,000 loans per month. However, it was forced to cease operations in 2008 with the collapse of the Zimbabwe dollar and hyperinflation.

During the intervening period, LonZim provided funding to Tradanet for the development of a new software system that was used to re-launch the business in the first half of 2009. The new system was built on the previous experience of Tradanet but set up automated loan processing and administration and improved security.

In 2009, Tradanet secured the backing of a leading Zimbabwe financial institution for the re-launch of the business. By October 2009, following the successful completion of a three month trial, significant funding was injected by the financial institution to meet the demand for the microfinance, low value, US dollar denominated, loans.

Tradanet has now provided over $25 million in loans since mid 2009 to 22,000 individuals and is continuing to grow rapidly. June 2010 achieved US$ 3.5m in principal and interest payments.

The Tradanet product is now being used by 45 companies, who recognize that providing this service is an important service for their employees to access finance. Importantly, borrowers using the Tradanet product, accessing 6, 9 or 12 month loans, have only defaulted on less than 1% of their loans.

Tradanet is in advanced talks with other leading financial institutions within Zimbabwe to replicate the successful loan processing service to a wider range of payroll based clients. The payroll based microfinance market in Zimbabwe is estimated by management to be US$ 300 million. Tradanet / LonZim, is also working with leading local financial institutions to attract foreign capital into Zimbabwe to further support and grow the microfinance available for payroll based loans in the country.

Payroll based microfinance loans are considered by both economists and development organizations to be an important component in the rebuilding of the Zimbabwe economy. For the majority of formally employed Zimbabweans, the LonZim Tradanet product is the only access to reasonably priced finance available

David Lenigas, LonZim Executive Chairman commented :

The LonZim Tradanet business is important to Zimbabwe. The ability for workers to utilise payroll based microfinance loans is a fundamental element of the economy and helps provide the liquidity necessary to support recovery and growth. LonZim believes in the future of Zimbabwe as a strong economic participant in the region, and companies like Tradanet demonstrate the progress that is being made towards this goal.

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