BANKS CHALLENGED TO DESIGN ATTRACTIVE PRODUCTS FOR CUSTOMERS

Caleb Fundanga

Situmbeko Musokotwane

Minister of Finance and National Planning, Situmbeko Musokotwane, has called on banks and other financial institutions to be innovative and design attractive products to the public.

Dr. Musokotwane said Zambia’s financial sector has grown but there was little that had been done in providing attractive services and products to the customers.

He said despite the growth recorded in the financial sector, few people were accessing financial services in Zambia.

“The growth in the financial sector goes beyond just the number of financial institutions in the country. There is also need to innovations of products,” he said.

Dr. Musokotwane was speaking today at the national launch of the Zambia Finscope 2009 survey findings.

He noted that there was only a slight growth in the number of adults served by financial institutions in the country.

The minister said the survey showed a slight increase in the financially served adults from 33.7 percent in 2005 to 37.3 percent in 2009.

He explained that almost two thirds of the Zambian adult population still did not use any type of formal or informal financial product or service.

Dr. Musokotwane assured financial institutions of Government’s commitment to work with them to help Zambia become a middle income country by the year 2030.

The minister has meanwhile urged financial institutions to open up banks in rural in order to ease difficulties which Civil Servants faced in getting their salaries.

He said some Civil Servants, especially teachers, health workers and policemen were subjected to walking long distances to get their salaries, a situation he said affected their performance.

Dr. Musokotwane has also called on banks and other financial institutions to consider giving mortgages to teachers to help them build their own houses.

He said the education sector was faced with lack of housing for teachers in the country hence the need to empower young teachers with loans to build houses.

Banks challenged

Earlier, Bank of Zambia (BoZ), Caleb Fundanga, said at the same function that the role played by financial institutions in Zambia’s economic development had been limited in recent years.

Dr. Fundanga said the financial sector has been characterised by low financial intermediate and a high concentration of bank branches in urban areas.

“This has resulted in limited access to financial services for the rural population and the low to middle income earners in the country,” he said.

He said to address this challenge, the financial sector should determine the status of supply and demand for financial services in the country.

He said to do this, Government formulated the Financial Sector Development Plan (FSDP) to address various sectoral weaknesses and ultimately broaden Zambia’s financial sector.

Dr. Fundanga hoped that the findings of the survey will trigger innovation in products design by financial institutions in order to serve customers better.