This content was released on Business Weekly Zimbabwe 22 – 29 June 2018 in Company News, page 3. Written by Kudzanai Sharara.
FinMark Trust, an independent trust established to promote financial inclusion and regional financial integration, has announced its plans to set up base in Zimbabwe.
FinMark Trust, which provides evidence based data to support the development of financial inclusion strategies, is most known in Zimbabwe for the FinScope Survey it conducted in 2012, which is still being used by Government and financial regulators to develop its financial inclusion strategy.
Ishmael Mkhabela, a trustee at FinMark Trust, told Business Weekly on Wednesday that the local office is expected to be established in August 2018, where the Trust will also hold a “Zimbabwe Financial Inclusion Forum” by end of the same month of August. Financial services experts from the region are expected to be in attendance and share their experiences.
Mkhabela said, while FinMark Trust has had representation in the country, through a project coordinator, it was now planning to establish a fully-fledged local office which is also expected to be a launch pad into the region, with another office in Malawi already on the cards.
Mkhabela said that the move to establish a formal office in Zimbabwe was motivated by the desire to help Zimbabweans improve their lives in terms of financial inclusion.
With Zimbabwe, we felt that there is, in terms of strategic imperatives, the roots, the hearts, the minds of people who would like to deepen and raise the bar for those who are marginalized financially by institutions
“With Zimbabwe, we felt that there is, in terms of strategic imperatives, the roots, the hearts, the minds of people who would like to deepen and raise the bar for those who are marginalized financially by institutions” said Mkhabela.
FinMark Trust believes a fully-fledged presence in Zimbabwe will enable the Trust to work with people in Zimbabwe and not only as a provider of services.
In 2012, FinMark Trust carried out a FinScope MSME Survey on Zimbabwe which showed that 43 percent of MSME owners in the country are financially excluded.
The survey was carried out under the auspices of the Ministry of Small and Medium Enterprises and Co-operative Development and funded by the Multi Donor Trust Fund headed by the World Bank.
Mkhabela said establishing a formal base in Zimbabwe will help impact a greater number of people through aligning and engaging with those on the ground.
“We have seen quite a lot of interest to understand how people who cross the river (Limpopo) are handling their money and how they are treated by financial service providers. There is no reason for people to carry a lot of money when crossing the borders, but marginalization and they quality of services could be the reason why it’s as such.
FinMark Trust data on the remittance market monitoring studies indicates that SADC migrants in South Africa remit safely and cost effectively.
“The relationship that South Africa has with Zimbabwe, as well as the importance of Zimbabwe in the SADC context has supported the decision by FinMark Trust to open an office in the country. We believe that we can support the successful implementation of the Government’s national Financial Inclusion strategy for the period 2016-2020, as well as support other initiatives such as increasing the impact of remittances.”
FinMark Trust will work with key sectors including the regulators, the central bank, Institute of bankers, Fintechs, Insurance Institutes in an effort to broaden access to, and use of, financial services by all Zimbabweans.
“I think establishing a formal office in Zimbabwe will demonstrate that to work in a particular way and not from South Africa, there is a lot of things which we can embrace.
“We need people in Zimbabwe with real experiences who talk the same language. It brings relevance to our work as people here will take the initiative and come up with relevant strategies and in the process raise the quality of work.
We need to look closely at different services which are impacting on our people, why are they not serving for instance or when they are serving, we need to understand how they are serving.
We also have to understand why some remain informal, is it pricing or is it how they are treated and so on.”
“There are other dynamics which need to be included” said Mkhabela. “We believe that through dialogue, through engagement and through sharing information and responsibility we are most likely to have greater impact on what we need to achieve and have a greater number of people financially included.
According to FinMark Trust, the Zimbabwean government is committed to financial inclusion as a tool to help lower poverty and inequality. Mkhabela and his team met with Finance and Economic Planning Minister Patrick Chinamasa earlier this week.
Nikki Kettles, head of FinMark Trusts SADC Financial Inclusion, said the reason why financial inclusion is so important is that if you can move people who are living below the poverty line, if you can move them into formal financial services there have more chance of staying above the poverty line.
“There is evidence and we firmly believe that it’s something that we need to look at” said Nikki Kettles. “So we will come in and work with the regulators and financial service providers and try take away blockage that keeps people out of credit. For example – KYC requirements, that’s a blockage in itself” she said.
She said there is no reason why SMEs are still not financially included “so we come and provide evidence based research.”
Mkhabela said FinMark Trusts work involves advocacy, research with no vested interest but with the only focus being financial inclusion. “We have come to be trusted as a mediator of some sort bringing institutions such as central banks and regulators together for engagement” said Mkhabela.
FinMark Trusts aims to support projects in MSMEs, cross border traders, small scale miners, credit registry, women and youth, national diagnostics and small businesses that focus on the export sector. The support will come through among other things, fund raising; market monitoring and research; advocacy; and capacity building amongst stakeholders but particularly at MOFED and RBZ.
About FinMark Trust
FinMark Trust (FMT) is an independent trust established in 2002 with the objective of making markets work for the poor. Initial core funding was provided by UKaid from the Department for International Development (DFID) through its Southern Africa office. Recently additional funders have come on board including the UNCDF, the Bill and Melinda Gates Foundation, the MasterCard Foundation as well as private and public institutions at country level. FinMark Trust’s purpose is ‘Making financial markets work for the poor, by promoting financial inclusion and regional financial integration’. FinMark Trust does this by conducting research to identify the systemic constraints that prevent financial markets from reaching out to these consumers and by advocating for change on the basis of research findings. Please visit www.finmark.org.za for more information.