Story by Stanley James, Business Editor
AS Zimbabwe celebrates 45 years of independence on April 18, the country’s banking sector has recorded huge milestones driven by a robust financial system dominated by domestic-owned banks.
Before independence, the banking system was mainly tailor-made for the white minority in terms of the provision of loans and access to services.
It was dominated mainly by two multinational banks whose terms and conditions only suited the white minority.
However, government interventions since 1980 are yielding results as evidenced by the rise in bank account holders across the country, digital financial services, and dominance of domestic-owned banks, financial inclusion and a roadmap to reduce bank charges while offering better returns to savings.
“The banking sector has also played a pivotal role in the overall growth of the economy, such a trend is evidenced by the rise in overall statistics in terms of the number of people accessing financial services across the country to the extent that going forward, the need to spruce up the image of the sector becomes of greater importance. As a result of the key milestones, Zimbabwe’s banking sector is now focusing on facilitating affordable bank charges, offering loans at concessionary rates including more loans to the productive sectors,” Economist, Dr Zack Murerwa said.
Another key highlight of the huge strides in Zimbabwe’s banking sector is that there has not been any bank failure or collapsed bank in the past 10 years.
“The course to growth is on track and this is manifested by the continuous growth in the number of banking services and also more investments so in the outlook it is all about tapping into viable strategies to consolidate growth and enhance the sector’s ability to extend more loans,” Bankers Association of Zimbabwe president, Mr Lawrence Nyazema said.
In line with the Government’s aspirations of leaving no one and no place behind, authorities are focusing on measures to widen access to banking services by the youths, women and marginalised communities.
Through these initiatives, AFC Financial Holdings was unbundled and rebranded in 2019 into four separate business units to strategically support the country’s agriculture sector which has been identified as a backbone of the country’s economic development.
The Leasing unit has provided the majority of small-scale farmers with the much-needed implements such as tractors and combine harvesters at affordable rates while the main commercial bank has availed agricultural funding which had been lacking under the previous structure, with the aim of making Zimbabwe self-sufficient in food security since the country attained independence.
The government also established the Women’s Bank solely to support women-owned businesses that have been largely excluded from participating in the mainstream economy.
Established in 2019 the bank has transformed many women-owned enterprises especially in the SMEs sector with the much-needed start-up and working capital and continues to make inroads in rural communities anchoring the Government’s mantra of leaving no one and no place behind.
The Youth Empower Bank was established targeting young entrepreneurs in different sectors of the economy and has made a positive impact in supporting the Second Republic’s economic development trajectory.
