Minister of Finance Saara Kuugongelwa-Amadhila spoke about progress implementing the National Financial Sector Strategy last week when she said that, “the good news is that, commendable progress has been made so far resulting from an improvement in financial inclusion reaching 69% of the population.”
The strategy launched on 15 August 2012 targets 74% financial inclusion of the economically active portion of the Namibian population by 2021.
The financial inclusion strategy rests on the two pillars of consumer financial literacy and protection as well as access to financial services and products. Fundamental reform initiatives that remain vital include consumer financial education driven by the Financial Literacy Initiative also launched in 2012. “This initiative has since been rolled out to virtually all regions of the country and several educational programmes are being advanced to the public. But what matters most is the effectiveness of such interventions and progress made over time,” the minister said. To determine that effectiveness the minister launched the first Financial Literacy Baseline Survey in Namibia in June. It revealed that financial literacy in Namibia is estimated at 42,8%.
In terms of consumer protection, Namibia has now gazetted the Credit Bureau Regulations to regulate credit information and for the registration of credit bureaus with the Bank of Namibia which will regulate the industry.
The ministry has also facilitated the introduction of the basic bank account and removal of all cash deposit fees by 31 March 2015. At the end of 2013, the number of active basic bank accounts at banking institutions were about 96 072.
Other on-going initiatives to enhance access to finance by small and medium enterprises include the investigation of setting up a risk facility fund for start-ups led by the Development Bank of Namibia. A study to explore the viability of a credit guarantee scheme is also being undertaken by the Bank of Namibia. Regulations amending the Banking Institutions Act 2 of 1998 and aimed at protecting bank customers against the use of unfair and unclear terms in bank contracts are currently subject to consultations with the banking industry. Also the Financial Services Ombuds Bill has been drafted and is being refined.
By Augetto Graig Informante