Swaziland: 54% Has No Access to Financial Products
Swaziland, June, 13 2013 -
This was revealed by Minister of Finance Majozi Sithole yesterday when launching the MAP (Making Access Possible) project, a tool to facilitate the development of the financial inclusion strategy for Swaziland.
Sithole, who was speaking through the Principal Secretary in his ministry, Khabonina Mabuza noted that the financial sector would effectively contribute to the country’s economic growth when it engages the entire population and all enterprise activities.
“We face a challenge of ensuring that we bring on board the 54 per cent of the population currently excluded from accessing financial products.
With the commencement of the development of the financial inclusion strategy, the country therefore has an opportunity to build a financial system that also advances urgent social and development goals. This process would mean acting on the belief that financial services are not an end in themselves but a means to an end,” he said.
Mbuso Gamedze from the office of the Registrar of Insurance and Retirement Funds recently revealed that only 17 per cent of the population was insured.
The minister explained that just recently, the country became the 145th member of the Alliance of Financial Inclusion (AFI), joining a host of other countries which have also put financial inclusion at the heart of their economic and national development goals.
“Today, 54 per cent of our people do not have access to the basic financial services that help them manage cash to meet daily needs, invest in opportunities and protect themselves against unforeseen risks. There is a huge portfolio of micro and small enterprises that also need access to diverse financial services. Meeting this demand is of course a huge challenge. It is also a big opportunity,” he explained.
Sithole said the strategy framework would provide an opportunity to discuss the key aspects of financial inclusion and the framework, including targets to be achieved and how to achieve them.
He noted that meeting the targets would require diverse products, tailored for different clients in different contexts, further stating that whatever product offered must be disbursed with convenience, afforda-bility and with some reliable way to make payments.
He said this was quite important, especially because an efficient payment system was the backbone for many other services.
Sithole explained that the only way to do this was to harness new delivery channels.
“In particular, mobile phones can play a huge role. We have over 800 000 users of mobile phones in the country and mobile money as well as cellphone banking presents a huge opportunity within the financial inclusion space. This opportunity, however, can only be exploited if we pursue innovative partnerships which will require working across traditional regulatory and services sectors,” the minister said.
High cost of lending needs to be addressed
MBABANE – The Ministry of Finance wants issues of high cost of lending to be addressed.
Minister Majozi Sithole, speaking through his Principal Secretary Khabonina Mabuza said there should be deliberations on consumer protection and financial education.
He said both these issues would require the country to accelerate ongoing policy initiatives and regulatory reforms that were geared towards responding to these issues.
He noted that responsible lending also required action by banks, microfinance institutions and other service providers, stating that part of building a responsible financial system meant growing only apace with quality.
“This means we must continue to consolidate and improve the reforms being made within the financial services industry. Institutions such as the Financial Services Regulatory Authority, the Central Bank and the finance ministry through the Micro Finance Unit have a lot of work to do. Issues like a lack of trust and the very high costs of lending need to be addressed if we want to make strides towards first world status, hence the emphasis on the right price, product, technology, capacity building support and innovate partnership can all help in this sector build new heights,” Sithole said.