Bank of Zambia Governor Dr. Caleb Fundanga
Bank of Zambia Governor Dr. Caleb Fundanga
Bank of Zambia (BOZ) Governor Caleb Fundanga says it is

important for commercial banks in the country to operate in a manner that supports growth and development of the country’s economy.

Dr. Fundanga said it was therefore important for commercial banks to lower the cost of banking and offer attractive banking services to the public.

The Central Bank chief said the general cost of banking services in Zambia should be made affordable to the general public.

He was speaking at the foundation laying stone ceremony of the new Stanbic bank offices in the Show grounds in Lusaka.

Dr Fundanga noted that the investment that is being made by Stanbic bank would have a positive impact on the economy due to the evident linkages that infrastructure development has on various sectors of the economy.

He pointed out that the repositioning by the bank is one way of ensuring that there is healthy competition in the banking industry.

Stanbic bank chief executive Ben Kruger said Stanbic is committed to service the people on the African continent.

Mr. Kruger said Stanbic is an African Bank that has a unique understanding of African business.

ZANIS

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21 COMMENTS

  1. What is all that talk ofrom Calab Fundanga on reducing the cost of banking in Zambia to make it affordable to the public. There are more serious areas you ve failed to address. The serious of Dollarization of transactions in Zambia. Man what are you doing about. This is weakening the kwacha, Schools. clinics, Hotels, contractors and common vendors have all been quoting their prices in US$. Your Deputy was crying crocdile tears on the subject yet the bank is suposed to direct policies.If the ZMK has become worthless then let us all transact in dollars. Stanbic should be encouraged to erect its own buildings to operate from not where they rent all over the country. I believe Ben Kruger , the bank will make resources available to indegenous Zambians not only favouring South African Investors.

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  2. Ba Fundanga please dont embarass us. The Banks wont reduce the cost of banking on their own free will. How long have you been appealing to them to reduce interest rates? Have they ever listened to you? I dont know but I think Zambian policy makers generally are not clever. Dr Fundanga may be you can take this opportunity to explain to us why the Bank of Zambia cannot set interest rates? Everyone else does it in the world. Fundanga you are aiding and abaiting criminality by financial institutions in Zambia. Shame on you!

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  3. When interest rates are high, people deposit more money in the bank because they can earn a high interest on their money. In short, if the interest rate of lets say ZANACO was high, you would be in a better position to open a savings account with ZANACO because you’ll earn a high interest on your money.

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  4. It is those who are borrowing that lose out because they will have to pay a high interest rate on their loans.

    If the interest rates must be lowered, the following need to happen first.

    1. Stability of the Kwacha. It must be stable so as to instill confidence in the banking system.

    2. There must be low inflation. Preferably single digit inflation. Inflation erodes the value of money and if there is low inflation, there is less erosion.

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  5. 3. Competition must be encouraged in the banking system. Encourage more competition in the sector. The publishing of bank interest rates in the local papers is a good way of fostering competition.

    4. Encourage more people to invest rather than consume. Opening a savings account is investing in a bank. If banks have got excess money, they have no option but to lend out and they only way they will encourage more borrowers to borrow from them is by lowering their interest rates.

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  6. Those are just some of the ways we can encourage more competition and growth in the banking system and lower the cost of banking. We do not need more regulation. The US banking system is the most regulated banking system in the world and it crashed. I am sure what we have learned is more regulation is not a good thing.

    We must not control the interest rates in Zambia. Controlling the interest rates is equivalent to setting price controls and one thing we have learnt is this does not encourage competition and causes an unpredictable boom-bust cycle.

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  7. You can preach all you like about your voodoo economics. The fact is that all self respecting central banks like the US Federal Reserve, Bank of England, European Central Bank, the Reserve banks of Australia, China, India, Brazil, South Africa even Ghana, Botswana and Kenya set the interest rates in efforts to ease borrowing for investments. Only in a banana republic like Zambia is robber capitalism allowed. It is laughable tha t a country can have interest rates of over 25%. Zambia is a joke. Honestly where does even this joke of a minimum balance in an account exist? You guessed right only in the joke called Zambia!

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  8. Free-Market-Economist, you have a sense of humor! Does the boom and bust cycle apply to Zambia? Iam in my late 30’s and all I have lived through in Zambia is a ‘bust’. I do not remember any ‘boom’. Please let us not fish for buzz words that have no relevance to Zambia.

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  9. “Does the boom and bust cycle apply to Zambia?”

    Mbulawa, read my comment again and please point to where I have stated the boom-bust cycle applies to Zambia.

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  10. Here is my last sentence at number 6.

    We must not control the interest rates in Zambia. Controlling the interest rates is equivalent to setting price controls and one thing we have learnt is this does not encourage competition and causes an unpredictable boom-bust cycle.”

    Mbulawa, pay attention to the way the sentence is structured.

    This is not stating the boom-bust cycle applies to Zambia. I have not made such a claim.

    Please stop with the strawman tactics.

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  11. Iwe Fundanga all you do is talk talk talk. We are tired of you dry talks. Interest rates 25% inflation 16%. Minimum account balance K600,000. These are the figures, instead of just talk talk talk do some work and reduce them to single figures.

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  12. I left K5million kwacha in my zambian account. I had plans of topping it up so that I could be supporting my aged parents. Barclays Banks chewed the whole amount in so-called bank charges. I wrote and rang the bank manager to explain that I was overseas, to no avail. The banks in Zambia are just expensive and exploitative pay-points. Never leave your money in Zed. I have learnt the had way.

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  13. Free market economist; do you care to tell me what you were trying to say in that sentence then? Can you please deconstruct it for me in plain English?
    And please pardon me for taking so long to respond to your charges. Apparently, I had gone shopping for sausages and T-bones from a Boer run shop downhere. And by the way I was with Frank. I bet you know Frank? A contributor on Zambian Economist. This is the guy you’ve been plagiarising from. We had a good laugh about it. Try to be original mate. Otherwise you will continue picking words and phrases whose meaning you do not know. Have a good weekend Free Market Economist or is it Plagiarist? lol!

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  14. Mbulawa

    What I am trying to say is if we control banking interest rates, the following could happen. One thing could lead to another. I am not saying we control the banking interest rates in Zambia and the following has happened.

    I am saying one thing COULD lead to that.

    I have never heard of Frank. Right after Zambian Economist gave a really poor review of Dambisa Moyo’s book (Dead Aid), I stopped reading because it became evident to me that the Zambian Economist is not a very good economist IMO.

    I want you to prove that I plagiarize from Frank (who I have not heard of BTW).

    (Good attempts at redherring by bringing up the Frank thing.)

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  15. Free market plagiarist!

    Tiye uko iwe. You’ve been caught with your pants down. You are a copy and paste technician. Who do you think you are going to impress? You have plagiarised the spat between some anonymous guy and Frank on Zambian Economist on the topic of the attorney general. All you did was copy Frank’s reactions to the anonymous guy. Plagiarism is a crime. It is easy to get caught especially when you are lifting from the internet. Try to be original. Although I doubt you will be able to tell us anything. And what is that you’ve just tried to explain? That is not what you alleged in 6.There is no “could happen” in 6 only a definite statement that “one thing WE HAVE LEARNT…” This is is the problem with people without any original thought i.e lack of consistence…

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  16. Mbulawa.

    Now you are joking with me. Even though I don’t get humor, I am sure there must be a joke in there.

    First thing I want to ask is when did Zambia have a system when it controlled the interest rates?? Take your time and explain this to me.

    Second, concerning the “one thing we have learnt” I was speaking with the American banking system where the interest rates are determined by the Federal Reserve system. The USA with all its regulation (most regulated banking system in the entire world) crashed it’s own banking system with one of the contributing factors being the control of the interest rates.

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  17. In the “one thing we have learnt”, I assumed it was obvious seeing that to my knowledge, Zambia has never had a system where the central bank determines the interest rates.

    On the issue of plagiarism, believe what you want. I have already told you that I do not know this Frank and I do not plagiarize his work. It is up to you to believe me or not. I don’t care what you think.

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  18. It is not unusual for central banks to keep low interest rates through monetary intervention. For example Bank of England has mantained its base rate at 0.5% even though inflation rate is about 4.5% in the UK because at times inflation could be tolerated as long as it is projected that it will be brought under control in due course.

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