ZB Bank’s agency banking volumes jump tenfold
INITIALLY developed in Kenya, the agency banking model is fast becoming a critical element of the financial services sector in Zimbabwe.
And one of its main proponents locally is ZB Financial Holdings’ banking arm ZB Bank, which began its own agent network in 2015 and had expanded it to around 10 000 agents as at the close of last year.
Group corporate services head Mr Shadowsight Chiganze said the increase in the number of agents has been accompanied by an increase in volumes transacted through the banking model.
“Volumes have grown more than tenfold and continue to grow. We aim to continue delivering access to financial services through our ZB Pauri/Khonapho card, which allows even non-ZB customers access to it,” he said without detailing figures since the company is currently in its closed period.
“We are rolling out a number of POS machines to allow easy access by our customers. Furthermore, our customers can also make use of any Zimswitch enabled POS machine.”
The group’s evolving banking model is centred around its prepaid card, the ZB Pauri/Khonapho card which allows even non-ZB customers to perform cashless transactions on any ZimSwitch-enabled machine.
Proponents of the agency banking model maintain that it allows banks to extend their reach with limited expenditure, while also benefiting the unbanked in society to have access to standard banking services.
The Reserve Bank of Zimbabwe (RBZ) approved the adoption of the model as part of its drive for extending financial inclusion countrywide.
The 2012 FinScope MSME Survey and the 2014 FinScope Consumer Survey revealed that 23 percent of the country’s adult population was financially excluded, and that only 30 percent of Zimbabwe’s adult population made use of banking services as at 2014.
Additionally, only 14 percent of MSME (micro, small & medium enterprises) owners were banked and only 1 percent of the adult population made use of capital market services.
These statistics pointed to a need to drive financial inclusion in the country.
Mr Chiganze said the group appreciates the critical role that the agency banking model plays, not only in respect of financial inclusion but also for the group’s bottom-line in view of increasing competition from the mobile money platforms of telecommunications firms.
“Agency banking has the potential to empower many communities including those previously marginalised, by providing them access to financial services.
“This is much greater in most remote areas where people are no longer geographically excluded from financial services. People will no longer need to travel long distances to get banking services, for they will no longer need to go into a real bank again.
“For the agent, it gives them the opportunity to make additional income from commissions earned. For the bank, agency banking will help in business growth that can win back important market share from Telcos (mobile telecommunications companies),” he said.