Empower Bank on the cards
THE Government will establish a new microfinance institution called ‘Empower Bank’ as part of efforts to facilitate financial inclusion of the unbanked market under the National Financial Inclusion Strategy.
Early this year, the Government launched a five-year financial inclusion programme (2016-2020) meant to increase the overall level of access to affordable and appropriate formal financial services within the country from 69 percent in 2014 to about 90 percent by 2020.
Reserve Bank of Zimbabwe Governor Dr John Mangudya has said an inclusive financial system facilitates the mobilisation of financial resources circulating in the informal sector, which impacts positively on liquidity in the economy.
According to a 2014 Finscope consumer survey, 23 percent of Zimbabwe’s adult population was financially excluded, with only 30 percent of the country’s adult population making use of banking services.
Presenting the mid-term fiscal policy statement last week, Finance and Economic Development Minister Patrick Chinamasa said modalities for the establishment of the proposed bank to be called ‘Empower Bank’, including capitalisation, are being developed.
“Government is also considering the establishment of a micro-finance institution, to be called Empower Bank . . . the modalities for the establishment of the proposed Empower Bank, including capitalisation, are being developed in consultation with all the relevant authorities, including the monetary authorities.
“Given the constrained fiscal space Government is currently operating under, establishment of Empower Bank will not be seeking funding from the fiscus,” said the Minister.
In the 2016 national budget, the Government also proposed the setting up of the Women’s Bank, which is still on the pipeline.
“In the same vein, in fulfilment of my proposal in the 2016 national budget for capitalisation of the Women’s Bank, Treasury is also mobilising $5 million for the proposed micro-finance institution before year end,” said Minister Chinamasa.
“This institution is very important for supporting various women and youth projects as a way of promoting their economic empowerment.”
The establishment of Zimbabwe’s first Women’s Bank has been on the cards since 2010 but because of lack of funding, operationalisation of the bank has been delayed.