Online Reporter
Nelson Gahadza
Zimpapers Business Hub
BANKING sector reform and financial deepening are at the centre of the National Development Strategy 2 (NDS2) economic transformation agenda, with the Government setting an ambitious target to raise financial inclusion to over 90 percent by 2030.
Zimbabwe’s next five-year economic blueprint, 2026-2030, identifies the financial services sector as a critical enabler of inclusive growth, investment mobilisation and long-term economic stability.
At the core of the policy thrust are plans to widen access to formal financial services, deepen savings and credit penetration and harness digital finance as a lever for inclusive growth.
Through NDS2, the Government seeks to attract millions of unbanked and underbanked citizens into the formal system, while also reshaping the banking sector to support productive sectors of the economy.
However, the Actuarial Society of Zimbabwe (ASZ) has cautioned that achieving these objectives will require a fundamental shift in how banks assess risk, allocate capital and generate income.
In its review of the implications of NDS2 for the financial services sector, ASZ said that for banks to lend safely to productive sectors such as agriculture and small to medium enterprises (SMEs), traditional lending models will no longer be sufficient.
ASZ says banks need actuarial credit risk models that utilise alternative data points beyond conventional collateral-based approaches, particularly in an economy where many SMEs and smallholder farmers lack formal assets.
“In order to lend safely to the productive sectors such as agriculture and small to medium enterprises (SMEs) as envisaged in NDS 2, banks need actuarial credit risk models that utilise alternative data points beyond traditional collateral,” ASZ said.
The society further argued that the reforms envisaged under NDS2 go beyond compliance and call for a more strategic approach to capital management.
“Actuaries and risk officers must move beyond compliance-based capital calculation to strategic capital management, allocating capital only to business lines that exceed the cost of capital,” reads part of the ASZ report.
NDS2 also mandates the reduction of transactional charges and promotes financial technology through Regulatory Sandboxes, as authorities seek to drive inclusion through affordable, digital-first solutions.
In addition, the policy enforces Risk-Based Capital regimes across the sector, a move that ASZ says will significantly alter banks’ revenue models.
According to the Society, high non-interest income, which has historically cushioned banks against lending risks, will increasingly come under regulatory pressure.
“As a result, banks will be forced to rely more on funded income from lending activities and volume-driven digital transactions. This shift, ASZ noted, aligns with the broader objective of financial deepening but will test the sustainability of institutions that are slow to adapt,” reads part of the report.
