Business School

A serious problem confronting Zimbabwe is the savings gap, which essentially means that Zimbabwe as an economy cannot fund economic growth from domestic saving. There is a directly relationship between savings and income. Since savings largely depend on income, the low levels of income in the country translate into low levels of saving. Traditionally the access of the low income earners - who stay in rural areas as well as some high density residential areas - to modern financial institutions or even financial intermediaries is constrained by distance.This paper examines the importance of Mobile Money in promoting a culture of savings in Zimbabwe through Mobile Money related savings accounts

The bottom of the pyramid group which includes the elderly and the labour force in informal employment are generally not served by the banks and other financial institutions, yet they often have the same needs as their counterparts at the top of the pyramid. Mobile money has provided a solution were people can now do almost all their financial transactions on the cell phone, it’s time that social security considers mobile money as a new way to disburse pensions to the retired. This will help minimize the cost of accessing their funds.

There is not much literature on micro savings in Zimbabwe, as there is on micro lending, but we are strongly inclined to believe that financial education will lead to micro savings and micro insurance on mobile money platforms. Micro savings and insurance can, by transmission mechanisms create micro investments and in the long run create employment, even if it comes as self-employment, it’s still sustainable and helps in poverty alleviation.

On 12 August 2015 the Reserve Bank of Zimbabwe issued an ultimatum for all bank operating in Zimbabwe to submit financial inclusion plans for the next three years.  The banks have been given until 31 December to submit board approved financial inclusion plans to the central bank. The central bank further stated that going forward it will not license new banks that do not have a clear, board approved financial inclusion strategy.

Zimbabwe was once the breadbasket of Africa, we exported
anything and everything, from grain to textiles,
to the rest of the continent and beyond. Our industries
were arguably the best in the region, producing quality
products. Who would think of importing clothes
when we had barons, Topman and Avant? Almost all
manufacturing companies were up to standard. No
beef compared to our beef.
Those were the Glory days we need to reclaim them.