Story by Owen Mandovha, Business Reporter
THE growth and stability of the financial sector is reducing the financial exclusion gap as more players transform to become deposit-taking institutions to serve previously marginalised groups.
The granting of a licence for financial firm, Mukuru, to take deposits signifies a huge leap in the growth of the local financial services as confidence in the banking system rises.
The firm’s Group Managing Director Andy Jury says the milestone provides a perfect opportunity to further consolidate the Reserve Bank of Zimbabwe’s financial inclusion policy by leveraging on its vast national network outreach.
“This is big in terms of accelerating the national financial inclusion policy. The move means that the firm, which handles huge amounts of remittances in the industry, will be able to keep money in the formal economy where by nature withdrawals done prior to this development predominantly find themselves into the black market,” he said.
With many remittances naturally transitory in nature, the new deposit taking microfinance institution plugs a huge gap, serving the financially marginalised.
“We have seen a lot of microfinance institutions transitioning to deposit takers. This shows the level of confidence that new investors have in the market, but also many people who were previously unbanked have the opportunity to get banked over time,” economic Analyst, Mr Titus Mukove said.
The country has made huge strides in restoring confidence in the banking sector which had been at an all-time low due to bank runs on several high profile banks almost two decades ago.
The sector has remained largely stable, experiencing new investments in a major boost for the local economy.
