The Bankers Association of Zambia (BAZ) has raised serious concerns over the continued use of cash in the Zambian economy, warning that it remains a key enabler of money laundering and other illicit financial activities.
The remarks were made following the launch of the Financial Intelligence Centre’s (FIC) 2024 Money Laundering and Terrorism Financing Trends Report. In a media statement released to the media, BAZ applauded the FIC for its tenth consecutive report and expressed appreciation for the recognition given to the banking sector’s strong compliance with Anti-Money Laundering and Countering the Financing of Terrorism and Proliferation (AML/CFTP) requirements.
According to the report, Zambia recorded Illicit Financial Flows (IFFs) amounting to USD 3.5 billion in 2024, largely driven by commercial activities linked to multinational enterprises. One of the more notable incidents included a ZMW 10 million fraud case, where funds were siphoned primarily through cash withdrawals at ATMs and mobile money agents. BAZ confirmed that the matter is currently under investigation by law enforcement agencies.
While digital financial services (DFS) have become more prevalent, BAZ highlighted that cash remains a dominant method of transaction, often facilitating illegal financial flows due to its anonymous and untraceable nature.
“Cash transactions are often used to obscure the source and destination of illicit funds, posing challenges for financial institutions to detect suspicious activities,” the Association emphasized in its statement.
BAZ echoed the FIC’s caution that continued reliance on physical currency increases money laundering risks and undermines national efforts to improve financial transparency and security. The Association pledged its full support for the Bank of Zambia’s Go Cashless campaign, which is aimed at fostering a cash-lite economy by encouraging businesses and consumers to adopt safer, faster, and more transparent digital payment solutions.
“This initiative is driven by the belief that cashless payments are faster, safer, and more convenient… while also reducing the costs associated with handling physical currency,” BAZ stated.
Despite challenges such as increasing cyber-enabled financial crimes targeting automated and digital platforms, the banking sector was credited with being the highest reporter of suspicious transaction reports (STRs), contributing 96% of all STRs in 2024. The report also highlighted a 12.74% national decline in suspicious transactions and a drop in suspected public sector corruption cases, from 55 in 2023 to 40 in 2024.
In light of these findings, BAZ reaffirmed its commitment to maintaining high compliance standards, cooperating with the FIC, financial regulators, and law enforcement agencies to support Zambia’s AML/CFTP framework.
As the country prepares for the 2027/2028 evaluation under the revised Financial Action Task Force (FATF) standards, BAZ will continue to engage actively in national risk assessment efforts and advocate for a reduced reliance on physical cash in the economy.
