FBC to open SME bank

Livingstone Marufu
FBC Holdings, which is angling for the informal market, is set to open a new branch in Graniteside, Harare and the bank is specifically designed to cater for small and medium scale enterprises in Mbare and its environs; group chief executive officer Mr John Mushayavanhu has said.
The bank effectively joins other financial institutions such as ZB, Fidelity, Agribank and Stanbic that have deliberately targeted the informal sector.
Independent estimates suggest that SMEs contribute over 50 percent of gross domestic product (GDP) while employing about 60 percent of the population.
FBC Holdings’ chief executive officer Mr John Mushayavanhu told The Sunday Mail Business last week that the branch will be fully functional by the end of the year.
“It is no longer a dream but a reality that we are opening anytime from now. Everything in terms of renovations is through, what is left are just a few things to do with logistics.
“I am very happy with the way we have progressed thus far and there is nothing to stop the opening of the Graniteside SME bank for our people in Graniteside, Mbare Siyaso and the surrounding areas.
“We really need that (serious) money in the informal sector so we need to capitalise on bringing in the bank on the habour of Zimbabwe informal trading (Mbare) and make sure that the money is returned to the formal sector so that we can carry out more projects for the local people.
“After realising that everyone in the banking sector is going for the informal sector, we decided to move fast to get as many clients as possible,” said Mr Mushayavanhu.
The bank will also use various platforms such as FBC’s SMEs Banking Mobile Moola, a mobile payment platform; Eagle Insurance’s Hospital Cash Plan scheme and micro-finance services through Microplan to interface with the informal sector.
While the Reserve Bank of Zimbabwe (RBZ) estimates that there could be US$2,5 billion circulating in the informal sector, a FinScope MSME (micro, small and medium enterprises) survey that was conducted by the Ministry of Small and Medium Enterprises and Cooperative Development in conjunction with FinMark Trust and the World Bank in 2012 concluded that the turnover in the informal sector was more than US$7,4 billion.
Government and private investors are increasingly focusing on SMEs as high growth zones.
The Small Medium Enterprises and Development Corporation (SMEDCO) is now under the supervision of the RBZ following the amendment to the Small and Medium Enterprises Act.
In addition, Proparco, a development finance institution that is partly owned by the French Development Agency, recently extended two facilities worth US$20 million in support of SMEs through NMB Bank and CABS in February and March 2014, respectively.
ZB Financial Holdings, 25 percent controlled by Government, has registered 3 000 agencies to tap the country’s huge unbanked market and channel more resources to the mainstream economy.
The RBZ and Government’s economic blueprint Zim Asset emphasise the need to penetrate both unbanked and underbanked markets.