Financial Inclusion: Closing the Financial Services Provision Gap

The Competition and Consumer Authority (CCA) in partnership with the Ministry of Finance and Economic Development and financial sector institutions is hosting Financial Inclusion workshops around the country.

The aim of the workshops, which cover Jwaneng, Tsabong, Hukuntsi, Ghanzi, Maun, Kasane and Selebi-Phikwe; is to educate and empower consumers about relevant financial facilities, and to close the gap of consumers who are excluded from financial services. Experts in the financial sector such as the Banking Ombudsman, and financial services providers have been engaged in the workshops as resource persons.

Financial Inclusion is one of the recommendations of the Botswana Financial Sector Development Strategy, and implementation of the Financial Inclusion Roadmap started in 2015.  Financial inclusion is achieved when consumers across the income spectrum in a country can access and sustainably use financial services that are affordable and appropriate to their needs. It considers Credit, Payments, Savings and Insurance. According to the World Bank, financial inclusion means that individuals and businesses have access to useful and affordable financial products and service that meet their needs – transactions, payments, savings, credit and insurance – delivered in a responsible and sustainable way.

Financial Inclusion contributes to access to credit, poverty reduction as well as economic empowerment. It is critical to empower consumers through education and protection so that they can fully benefit from the financial services and products in the market. Lack of financial education contributes to people making wrong financial decisions.

A Finscope survey conducted in 2014 found that despite the coverage by banks and post offices, 30% of the population in Botswana live in settlements that are not served by any of the financial service providers.

The Financial Inclusion Roadmap goal is to reduce the percentage of adults who are excluded from 24% to 12%. If further aims to increase those with access to more than one formal financial product from 46% to 57% by 2021.

The main needs across target groups is the ability to send and receive money at low cost, earn good returns on long term savings, access short term flexible loans  and long term housing loans.