daniel chigunwe
Business Reporter
Zimbabwe has made notable strides in reducing the number of unbanked individuals in the country through various initiatives under the National Financial Inclusion Strategy (NFIS) and will continue to take advantage of technology to roll out further financial inclusion interventions, a Cabinet minister has said.
Speaking at the 2023 Global Reputation Forum in the House of Lords in England, Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube said Zimbabwe’s financial inclusion journey had been very positive and remained firmly on track.
“Financial technology plays a key role in providing financial services to all levels of society, underserved or marginalised groups including women and youths, micro, small and medium enterprises (MSMEs), rural communities and smallholder farmers, people with disabilities, pensioners and the elderly.”
Since 2014, Minister Ncube said Zimbabwe had witnessed rapid growth in financial inclusion, reducing the financial exclusion gap from 23 percent to less than 2 percent by 2022.
The growth was largely driven by the increased uptake of mobile money services, with 72 percent of households now having access to a bank, microfinance, or mobile account with which to transact digitally.
Technology-enabled financial innovation has proved successful and economical and will continue to be a major factor in determining the direction of financial inclusion, from the creation of new financial services and products to innovative ways of financial intermediation and delivery, including risk management on the part of financial service providers.
Due to its importance, the Government first developed and implemented NFIS 1, which ran from 2016 to 2020, and as a follow up the country is now in the second phase of the NFIS, which began in 2022 and will run till 2026.
“The second phase is mainly focusing on increasing financial inclusion access and usage for special groups including women and youth, Micro Small and Medium Enterprises (MSMEs), rural communities and smallholder farmers, people with disabilities, pensioners and the elderly,” Minister Ncube said.
The Government seeks to improve infrastructure as access to network coverage remains a challenge in rural areas, hindering the reach of digital banking and mobile financial services.
Cybersecurity and financial education are some of the key areas the minister said authorities have been focusing on under NFIS II to bring more convenience to the public.
“With the shift to digital platforms, cybersecurity becomes paramount, ensuring that financial data is secure is a continuous endeavor. Financial education through ensuring that the newly included population groups have adequate financial literacy,” he said.
However, Zimbabwe has integrated digital literacy into the national curriculum in schools, and information communication technology capacity development programmes are being rolled out.
“This initiative will facilitate digital financial literacy which is critical in understanding and interacting with financial services providers on the digital platforms that have now become the norm in the financial sector,” he added.
In the first phase, Zimbabwe managed to digitise financial services through a variety of digital channels, including payments, credit, savings, remittances, and insurance.
Thus, they use ATMs, bank cards, electronic banking, and mobile banking applications, among others.
According to the Treasury chief, these can significantly improve customer benefits and usage, as well as long-term sustainability for providers.
The first phase also created interoperability between banks and mobile network operators as well as a credit registry system aimed at enhancing the credit referencing environment in Zimbabwe.
A credit guarantee scheme was launched including the SME auction system, collateral registry, gold coins and gold-backed digital tokens among other financial innovations.
Online Reporter