Zambia Consumer Association (ZACA), has supported plans by the Bank of Zambia (BoZ), to start regulating exorbitant over the counter withdraw charges that Commercial Banks are demanding from customers.
Association Executive Director Juba Sakala said the decision is progressive and will go a long way in improving and promoting financial inclusion among the citizens in the country.
Speaking in an interview with ZANIS in Lusaka, Mr. Sakala disclosed that many people have started shunning banking services due to unreasonable charges that are attached to most transactions by banks.
He explained that the situation has also contributed to the high rate of unbanked population which is not good for the country’s economy.
Mr. Sakala stated that currently the country’s informal sector is bigger than the formal sector yet there is more money in circulation among the informal sector.
He noted that this is why it is important for people in the informal sector to start saving with banks.
Mr. Sakala added that savings for those in the informal sector can help in growing the country’s economy because Banks lend out money to individuals, firms and government for projects.
He said if citizens are encouraged to save they will also access loans from the financial institutions to grow their businesses and ultimately contribute to the country’s poverty reduction.
And Mr. Sakala pointed out that as much as citizens, especially those from the informal sector, are willing to keep their money in banks, they are scared away by charges.
He stated that this is why it is important for Commercial Banks to respond to the complaints by consumers and ensure that their services are improved and not exploitative.
When contacted for a comment Bankers Association of Zambia Chief Executive Officer Leonard Mwanza said the association is currently engaged in discussions with the Central Bank on the matter.
Recently Minster of Finance Margret Mwanakatwe told Parliament that plans were underway by BoZ to start regulating exorbitant withdraw charges by Commercial Banks following complaints of exploitation of over the counter charges levied on withdrawals.