Maputo, 5 Dec (AIM) – The Mozambican Ministry of Economy and Finance intends to connect around 3,300 savings groups to the national financial system throughout the country by September 2024.
The general director of the Fund to Support the Rehabilitation of the Economy (FARE), Augusto Isabel, announced the measure on Monday, on the sidelines of the 11th Forum of Savings and Revolving Credit Groups (GPCR), taking place in Maputo, under the motto: “Promoting the Sustainability of Savings and Revolving Credit Groups and their Connection to the Formal Financial System”.
The director explained that this is a measure in line with the National Financial Inclusion Strategy, which aims to facilitate access to financial services for all Mozambicans.
“The main objective is to find out how we can achieve our targets under the Rural Enterprise Financing Project (REFP), and the goal is to reach 3,300 Rotating Savings and Credit groups, which represents more or less an average of 25 members per group”, he said.
“This is also in line with the National Financial Inclusion Strategy 2016-2022, which has already ended, but the actions continue. All Mozambicans must be financially included so that they have access to financial services”, Isabel added.
In 2016, there were over 12,000 revolving savings and credit groups, whose savings were equivalent to around 11 million US dollars.
Although FARE does not consider these sums to be large, it nevertheless intends to “get these savings into the financial system so that it can take control of the volume of resources that are circulating within these communities.”
Many communities are currently saving by carrying large sums of money in suitcases or wooden boxes, which represents a risk in the event of climatic events such as floods that could destroy the money.
The general director also pointed to the remote location of much of the population as a challenge for including these groups in formal financial systems.
“We have several challenges and one of them is the location of these groups”, he said. “Although we have initiatives like ‘One District One Bank’, the distances from these communities to access these banks is still challenging. We also want to think about what technological solutions may be used to access financial services.”
FARE is already working to legalize these entities by registering them as commercial banks or electronic money institutions.