ZAMB NKER SEPTEMBER 2018 EDITION www.boz.zm A BANK OF ZAMBIA JOURNAL

ENHANCED BANKNOTES

Zambanker September 2018 1 ZAMB NKER

CONTENTS Views expressed in this publication are not necessarily those of the Bank of Zambia Management or the Editor PG 5 - NO IMF, GRZ FALL OUT HEAD OFFICE Bank of Zambia Governor, Dr Denny Kalyalya has Bank of Zambia, Bank Square, dispelled some media reports that the departure of International Monetary Fund (IMF) Resident Cairo Road P. O. Box 30080 Representative Dr Alfredo Baldini represents a Lusaka, 10101, Zambia rupture of the relationship between the IMF and the Tel: + 260 211 399300 Government of the Republic of Zambia (GRZ). Fax: + 260 211 221764/237070 E-mail:[email protected] Website: www.boz.zm

PG 8 - KWACHA, SHILLING COOPERATE FOLLOW US ON: Flickr: Bank of Zambia The Bank of Zambia (BoZ) and Bank of Tanzania Twitter: @BankofZambia (BoT) have signed a Memorandum of Understanding YouTube: Bank of Zambia (MoU) on Currency Convertibility and Repatriation aimed at providing a long-standing solution to Facebook: @BankofZambia informal foreign exchange activities at the Nakonde/ Tunduma border post.

MISSION: To achieve and maintain PG 13 - KANKASA - MABULA INSTALLED price and financial system ZCAS UNIVERSITY CHANCELLOR stability to foster sustainable economic BoZ Deputy Governor Administration Dr Tukiya development. Kankasa-Mabula has been installed Chancellor of the ZCAS University. The installation ceremony was held alongside the University’s second graduation ceremony on 31st August, 2018. ZAMB NKER SEPTEMBER 2018 EDITION www.boz.zm A BANK OF ZAMBIA JOURNAL

PG 23 - SUSTAINABLE ECONOMIC EMPOWERMENT

The Bank of Zambia, as always, took part in this year’s 92nd Agriculture and Commercial Show whose ENHANCED theme was ‘Sustainable Economic Empowerment’ which was held from 1st - 6th August, 2018 in Lusaka. BANKNOTES

Zambanker September 2018 1

2 September 2018 Zambanker BANKNOTES WITH IMPROVED SECURITY FEATURES LAUNCHED

By ZAMBANKER REPORTER

The Bank of Zambia has issued into circulation banknotes that have been upgraded with new security features. The new security features have been included to strengthen the security of the banknotes against counterfeiting and for easy verification by members of the public.

peaking at the launch of the upgraded a) A new security feature called the Sparklive has been banknotes, Bank of Zambia Governor Dr Denny incorporated in the figure on the lower right hand side Kalyalya said advances in technology have to further shield these banknotes from counterfeiting. provided counterfeiters with ever improving This security feature will exhibit three overt visual Smethods for imitating genuine banknotes. The Bank characteristics i.e. colour shift properties, optical will therefore always take measures that ensure that the Zambian banknotes are adequately protected from counterfeiting. This includes continually adopting more advanced security features that safeguard the integrity of the national currency and at the same time ensuring that the authenticity of the banknotes are easy to verify.

The new security features that have been included on the upgraded banknotes are as follows:

K20, K50 and K100 denominations:

Story continues on page 4 Zambanker September 2018 3 Continues from page 3 brightness and dynamic light effects. b) A 5mm optically visible four-window security thread with micro optical dynamic effects has replaced the hologram in the three denominations. c) The ‘birds in flight’ feature has shifted from the right edge of the back of the banknote to the left edge. d) The ‘tactile mark’ for the visually impaired has now been put on both edges of the banknotes to enhance tactility or the feel effect.

K10 denomination

b) Tactile marks for the visually impaired have been put on both edges of the banknotes to enhance tactility. a) A new four-window security threat will replace the hologram on the front of the banknote. The BoZ Chief clarified that all other features on the banknotes will remain the same. He further advised b) Tactile marks for the visually impaired have been that the Bank will start circulating the upgraded put on both edges of the banknote to enhance tactility. banknotes in a phased manner, staring with the K2 and K5 denominations in August, 2018. K2 and K5 denominations The existing banknotes will not be withdrawn until the a) Different images (dove, text K2 and K5) appear as end of their circulation life. This means the existing a new glossy varnish with a blind embossing for ease banknotes will co-circulate with the upgraded series of identification. and will continue to be honoured at full value.

4 September 2018 Zambanker NO IMF, GRZ FALL OUT By ZAMBANKER REPORTER

Bank of Zambia Governor, Dr Denny Kalyalya has dispelled some media reports that the departure of International Monetary Fund (IMF) Resident Representative Dr Alfredo Baldini represents a rupture of the relationship between the IMF and the Government of the Republic of Zambia (GRZ).

r Kalyalya has assured that the IMF Resident Representative left Zambia to take on new Dresponsibilities and not that he was leaving due to alleged strained relationships between the two parties. He explained that the IMF will typically rotate its staff both in country (i.e. the Resident Representative) as well as the country teams in Washington.

“In this regard, you may wish to note that the Zambia country team in Washington is also fairly new, with virtually all of the staff who had been on the Zambia desk for several years having been rotated. Indeed, we now have a new Mission Chief, as well as new incoming staff looking at the external, fiscal, real and monetary Dr Denny Kalyalya sectors of the economy. As I have said many times before, Zambia is a shareholder of the IMF and is currently “On behalf of the Bank of Zambia and and WBG to facilitate the sharing of represented at the Board of Governors indeed on my own behalf, I join the cross-country analysis and lessons by the Honourable Minister of Finance. Ministry of Finance in thanking Dr from experience, tailored policy The Bank of Zambia Governor is the Baldini for his work in Zambia, and advice and technical assistance to Alternate Governor at the IMF. Zambia specifically for the training he was support members in creating an is in good standing with the IMF and able to conduct with Bank of Zambia appropriate set of fiscal incentives for World Bank Group (WBG) and as such and Ministry of Finance staff on export promotion, while preserving is participating fully and normally macroeconomic policy analysis. We fiscal sustainability at a meeting held in the current nominations for the wish him well and God’s continued in Sharm El Sheikh, Egypt, from 4 – 9, Executive Directors at the Board of blessings in his future endeavours,” he August 2018. both institutions for the period 2018 – said. 2020,” he said. The Annual Meeting of the Association Meanwhile Dr Kalyalya has announced of African Central Banks included a He said differences of opinion do and that the African Caucus of the symposium, which focused on issues have occurred between the IMF and Governors, and Alternate Governors of declining correspondent banking the Government regarding economic of the IMF and the WBG is committed relationships and illicit capital flows policies before, adding that this is to creating an enabling environment that have adversely affected many normal and they have and will always for private investment and called upon African economies. The highlighted be addressed through the consultative the IMF and WBG to provide technical solutions to these problems included, processes that are in place, namely, assistance with respect to adjusting among others, strengthening the AML/ the annual Article IV reviews as well the legal frameworks. CFT regimes and banking supervision as IMF programmes, where such regulations, strengthening the capacity programmes are agreed upon. He Dr Kalyalya explained that the of respondent banks to manage elaborated that there is also constant Governors also expressed strong risks, developing regional responses dialogue between the Government interest in promoting exports and in collaboration and combating and IMF staff. diversification and called for the IMF corruption.

Zambanker September 2018 5 BoZ CAPITALISES DIGITAL EVOLUTION

By ZAMBANKER REPORTER

Deputy Governor-Administration Dr Tukiya Kankasa-Mabula has reiterated that the Bank of Zambia (BoZ) has embraced the rapidly evolving digital landscape and has incorporated initiatives to capitalise on this trend in its strategic plan. For instance, the Bank in-conjunction with Zambia Electronic Clearing House Limited and industry is currently undertaking a project to implement the National Financial Switch. The National Financial Switch is a shared payment system infrastructure that is aimed at interconnecting ATMs, Point of Sale (POS) Machines, mobile payment and other gadgets in the country and facilitating convenient provision of banking and financial services. Further, the Bank has also committed to the development of sandbox guidelines to promote innovation and the growth of fintechs for financial inclusion.

peaking at the 4th Banking least 25 Fintechs developing solutions & Finance conference of the in the country,” she said. Zambia Institute of Banking Earlier Dr Kankasa-Mabula and Financial Services, on the said the year’s theme is The Deputy Governor elaborated Stheme, “Breaking the mold –financial that digital financial inclusion can inclusion with a digital landscape & a very important topic as be broadly seen as digital access to a global perspective,” Dr Kankasa- it is consistent with the and use of formal financial services Mabula said it was worth noting by excluded and underserved that technology is an enabler for Government’s national populations. Such services should financial inclusion, adding that the agenda to proritise digital be suited to customers’ needs, and digital economy is rapidly developing delivered appropriately at a cost worldwide. delivery channels as a key both affordable to customers and driver of financial inclusion sustainable for providers. In addition, She explained that technology is digital transaction platforms can offer one of the most important drivers as espoused in the national a safe place to store value for millions of innovation, competitiveness and financial inclusion strategy. of households. Digital transactional growth for any financial sector and platforms yield further benefits for the national economy at large. She financial inclusion by providing a said the advancement and adoption innovations and changing mindsets means to access additional financial of technology and digitalised of users of financial services. We services, such as interest-bearing business models will enable financial are witnessing the emergence of savings, credit, insurance, and even institutions to achieve greater scale, financial technology (Fintech) players investment products. Additionally, reduce on operating costs, penetrate focused on enabling greater financial access to transaction banking new markets more swiftly, and inclusion. These Fintech companies is enhanced particularly to the understand their customers better. are mitigating financial frictions financially excluded, through other by designing innovative products digital products such as e-money “Technological innovations are or following innovative business wallets, along with debit cards and fostering creative new approaches strategies, with the common end low-cost regular bank accounts. This to enhanced financial inclusion. it is goal of enhancing financial inclusion platform also generates data that evident that a financial revolution is with a digital landscape. It is elating financial service providers can use taking place around the globe, Zambia to note that the Fintech landscape in to design financial products to suit included, powered by mobile phones, Zambia is also evolving. A survey of the repayment capacity and financial access to new data, technological this market showed that there are at needs of the specific poor and low- Story continues on page 14 6 September 2018 Zambanker SECONDARY MARKET DEVELOPMENT PROJECT

By ZAMBANKER REPORTER

The Bank of Zambia will be introducing a Primary Dealership System (PDS) to support the development of the Secondary Market. Primary Dealers (PDs) are financial intermediaries that agree to perform specific obligations or functions in the operations of the Government securities market in exchange for specific privileges. The introduction of the PDS is aimed at increasing liquidity in Government bond trading in the secondary market. A secondary market is a market where investors purchase securities or assets from other investors, rather than from issuing organisations themselves.

he BoZ will announce the The bulk of their holdings was still commencement of receipt of held in Government bonds (K8.8 billion applications to be PDs in due Dr Kalyalya also explained that the against K0.1 billion in T-bills). course. The announcement average overnight interbank rate Tof the appointed PDs will be made Dr Kalyalya also explained that the by December 31, 2018. The Primary was contained within the Policy average overnight interbank rate Dealership System is expected to be Rate corridor, c losing the second was contained within the Policy Rate operational by February 2019. In this corridor, closing the second quarter context, the BoZ will establish a special quarter at an average of 9.67%, 8 at an average of 9.67%, 8 basis points Securities Lending Facility, the Backstop basis points below the Policy Rate below the Policy Rate of 9.75%. During Repo Facility (BRF) and an Electronic the quarter, the overnight interbank Trading Platform (ETP) to support the of 9.75%. During the quarter, the rate peaked at 10.09% and the Bank implementation of the PDS. The BRF overnight interbank rate peaked at conducted expansionary open market will be a Lender of Last Resort Facility operations to steer the interbank rate that will be exclusive to PDs. The BRF 10.09% and the Bank conducted closer to the Policy Rate. Accordingly, is intended to support the PDs’ market- expansionary open market market liquidity rose to K1.1 billion making obligations and mitigate the risk from K0.8 billion recorded at the end of of delivery failure. An ETP is a facility operations to steer the interbank quarter 1. which provides electronic trading rate closer to the Policy Rate. of securities as opposed to manual This was mainly attributed to net trading, thereby introducing efficiency. Accordingly, market liquidity rose Government securities maturities, net The ETP will enable price discovery, to K1.1 billion from K0.8 billion Government spending, BoZ foreign transparency, and monitoring of PDs by exchange purchases for reserves the Bank of Zambia and the Securities recorded at the end of quarter 1. accumulation and net OMO maturities. and Exchange Commission (SEC). This notwithstanding, the rise in to K0.9 billion while demand for bond liquidity was moderated by statutory Meanwhile the Governor announced by institutional investors more than reserve withdrawals, OLF repayments during his August monthly meeting doubled to K2.2 billion. and currency withdrawals. Despite with CEOs of financial institutions the increase in market liquidity in the that demand for Government He attributed the fall in demand by non- second quarter of 2018, funds traded on securities moderated in the second resident investors partially to negative the interbank money market increased quarter, mainly due to a substantial market sentiments surrounding Zambia’s to K42.5 billion from K34.0 billion in the reduction in the demand for Treasury external debt position. Consequently, first quarter of 2018. bills by non-resident investors and the subscription rates for T-bills and institutional investors. Non-resident Government bonds fell to 43% and 124% Banks’ access to the OLF rose to K2.4 investors demand fell by 97% to K0.03 from 98% and 153%, respectively. Despite billion compared to K2.3 billion accessed billion while the demand for T-bills by the fall in demand for Government in the first quarter while Kwacha institutional investors fell by 71% to K0.2 securities, total holdings of Government liquidity accessed through foreign billion. Demand for Government bonds securities by non-residents increased by exchange swaps increased to K4.1 by non–residents also declined by 18% 1.5% to K8.8 billion at end-June 2018. billion, up from K2.2 billion in quarter 1.

Zambanker September 2018 7 Governor of the Bank of Tanzania Professor Florens Luoga and BoZ Governor Dr Denny Kalyalya signing the MoU on currency convertibility and repatriation.

KWACHA, SHILLING COOPERATE ...as Zambia, Tanzania agree to repatriate each other’s currencies circulating on either sides of the border

By ZAMBANKER REPORTER The Bank of Zambia (BoZ) and Bank of Tanzania (BoT) have signed a Memorandum of Understanding (MoU) on Currency Convertibility and Repatriation aimed at providing a long-standing solution to informal foreign exchange activities at the Nakonde/Tunduma border post. With this MoU, the Bank of Zambia will, at its own cost, collect excess Tanzanian Shilling from registered financial institutions in Nakonde and repatriate the currency to the Bank of Tanzania. Similarly, the Bank of Tanzania will collect and repatriate, at its own cost, excess Zambian Kwacha to the Bank of Zambia.

peaking at the signing “The genesis of this particular MoU changers. This is despite the presence ceremony, Bank of Zambia dates back to the period around 2009 of registered financial institutions, Governor Dr Denny - 2010 when the two central banks which at that time included, six banks Kalyalya explained that held their initial conversation on this and three bureaux de change in Sthis development was intended to matter. Unfortunately, the discussions Tunduma and three banks and seven facilitate convertibility between the stalled along the way. Most importantly, bureaux de change in Nakonde. The Zambian Kwacha and the Tanzanian however, the discussions were re- informal trading of foreign currencies Shilling, without having to go through activated last year in September by the is conducted mainly through the the US dollar, which in most cases is Bank of Tanzania. This followed the 6th Zambian Kwacha, Tanzanian Shilling, not available. He said the idea of this Joint Meeting of Permanent Secretaries and the United States dollar. This is MoU was not new although it was of Zambia and Tanzania held on April because of inconvertibility between the being actualised now, adding that the 25, 2016, when our two institutions Zambian Kwacha and the Tanzanian establishment of MoUs between central were asked to work together and Shilling. Convertibility would therefore banks was an initiative that was born resolve the problem of informal foreign only occur via the US dollar using in the 2000s out of the Meetings of the exchange activities at this border. the informal money changers. The Committee of Central Bank Governors Consequently, the two institutions exchange rates obtaining among of the Southern African Development formed a Joint Technical Committee informal money changers are highly Community (SADC - CCBG). Since then, to develop workable solutions to this volatile due to supply and demand a number of countries have set up problem,” he explained. conditions for the US dollar as well as such arrangements with each other. speculative behaviour among informal The Bank of Zambia has an MoU with The Governor elaborated that the money changers. the Bank of Mozambique. Similarly, Committee established that informal the Bank of Tanzania has similar trading of foreign currencies at this He said this practice had led to the arrangements with its neighbours border was widespread, resulting in re-emergence of parallel exchange from the East African Community. the proliferation of informal money rates, thereby negatively affecting the

8 September 2018 Zambanker The two governors exchanging the signed MoU

efficiency of trade at this border. This of cargo south-bound through the electronic payments for trade and also led to a practice where traders border is estimated at US$ 1.5 billion statutory activities; and implementing and travellers cross the border without per annum. Over the period 2012- currency convertibility and declaring foreign currency in their 2017, the total value of trade between repatriation between the Tanzanian possession, thereby undermining Tanzania and Zambia going through Shilling and the Zambian Kwacha. efforts by the authorities in both the border averaged about US$ 180 Most of these recommendations have countries to enhance tax collection. million per annum, of which Tanzania been and continue to be implemented, recorded trade surpluses for most of cutting across many Government The current practice of informal foreign the period. Departments and Agencies in both exchange activities violates foreign countries,” he explained. exchange regulations of both Tanzania “Our two institutions therefore found and Zambia and as such needs to be it necessary to integrate the informal At the start of this exercise in addressed. Stand-alone measures to foreign exchange activities into the September 2017, the Bank of Tanzania mitigate informal currency trading formal foreign exchange market while had already implemented an electronic have been instituted by the authorities safeguarding trade and other income monitoring system for bureau de in both countries. These measures generating activities at the border. change transactions. The Bank of have included sensitization of the This will also complement our strides Zambia has now implemented a similar business community and consumers and efforts in advancing the financial electronic monitoring system for on the benefits of transacting using inclusion agenda in our respective bureaux de change transactions. The legal tender in each country and countries. The Joint Technical Bank of Zambia is engaged in various using registered financial institutions. Committee came up with a number of efforts that are aimed at promoting However, these interventions have possible solutions to this practice. These digital financial services, both locally not produced the intended results of include the following: sensitization of and within the region. Zambia, being a eliminating informal currency trading. the public on the need to use registered member of the SADC, supports regional financial institutions; synchronizing initiatives to promote integrated The Tunduma-Nakonde border is operating hours of registered financial payment arrangements, such as the use a busy business hub linking major institutions with arrival/departure time of the SADC Real Time Gross Settlement cities of Dar es Salaam, Lusaka, and of public transportation; facilitating System (RTGS) platform. The SADC Lubumbashi. The border handles more access to adequate amounts of foreign RTGS platform promotes investment than 90 percent of cargo from the port currency at registered financial and trade as well as digital financial of Dar es Salaam. On average, the value institutions; promoting the use of services in the region. Story continues on page 16 Zambanker September 2018 9 ENHANCE DISABILITY SERVICES

By ZAMBANKER REPORTER

Bank of Zambia Governor, Dr Denny Kalyalya has urged Commercial Banks to take into account the needs of customers with disabilities and include design features that ensure full and equal enjoyment to all banking services. Speaking during his meeting with Chief Executive Officer’s of Commercial Banks recently, the Governor noted that although there exist some efforts to provide full access to public facilities for persons with disabilities, there was still need for banks to enhance their facilities in order to ensure there are no difficulties for disabled persons when they come to access financial services.

e said some of the challenges faced include lack of reserved parking spaces, Meantime, the Governor has poorly designed entrance or appealed to commercial Hsteps into the bank, high ATM platforms and ATM booths. banks to consider establishing branches in Zambezi District “These challenges have resulted in persons with disabilities and the or engaging in agency elderly often requesting for assistance banking. Currently, the only from security officers, family or passers-by and in the process revealing financial institution operating information to third parties which in the District is the National compromises security of this sensitive information. We therefore urge all Savings and Credit Bank commercial banks to enhance current (NATSAVE). banking facilities and ensure all new facilities are able to properly accommodate persons with disabilities The Governor also expressed and the elderly, going forward,” he appreciation at the commercial banks implored. that attended the Financial Literacy Award giving event held in Lusaka Dr Denny Kalyalya Meantime, the Governor has appealed at which a number of them received to commercial banks to consider Awards, an indication that they were establishing branches in Zambezi on the right path of taking financial “From these few examples, it is clear District or engaging in agency banking. education to the general public. He that there is general lack of information Currently, the only financial institution said it was the hope of the Central Bank on financial matters. We therefore operating in the District is the National that all financial institutions would encourage you to make deliberate Savings and Credit Bank (NATSAVE). continue to do this throughout the year. efforts and host programs that are aimed He added that a significant number at educating our citizens on financial The Bank recently received a petition of citizens lacked the knowledge and matters. Good financial decision making from residents of Zambezi District in skills required in performing financial by the general public will provide for a North Western Province, through the transactions and decision making. win-win outcome for both the financial Zambezi District Business Association service providers and the customers. It (ZDBA), on the need to establish a He said the low level of financial is also worth noting that the negative commercial bank in the District. capability was evidenced by the publicity that is associated with some of following examples of common cases the highlighted symptoms of Financial He explained that Zambezi District has witnessed in the industry: low adoption Capability (irresponsible borrowing, a lot of potential with an active public of electronic payment methods; Advance Fee Schemes) does not reflect sector and various economic activities, customers consuming financial products well on the financial industry. We which include agriculture and fishing. that do not match their needs; fraud therefore have a duty to help our fellow Further, a gold mine is expected to open through Cases of Advance Fee Scheme; citizens by improving their Financial in the area as revealed by the advanced cases of irresponsible borrowing; and Capability which will improve their mineral exploration activities. high level of non-performing loans. livelihoods,” he explained.

10 September 2018 Zambanker BoZ CRACKS WHIP

By ZAMBANKER REPORTER

The Registrar of Financial Service Providers has cancelled the licences of Focus Financial Services Limited and Blue Financial Services Zambia limited in accordance with Section 17 of the Banking and Financial Services Act, 2017. The cancellation of the licences was due to the persistent breach of the Banking and Financial Services (Capital Adequacy) Regulations and failure by the two institutions to meet their obligations as they became due.

n a statement issued to the press recently, Assistant Director- Communications Mr Kanguya Mayondi said Ithe cancellation of the licences entails that Focus Financial Services Limited and Blue Financial Services Zambia Limited ceased to operate under the Banking and Financial Services Act, 2017 and the Banking and Financial Services (Microfinance) Regulations, 2006 respectively. However, the cancellation of the licences does not relieve the two institutions of any obligations they incurred or assumed during the period of validity of their licences.

Meantime, the Bank of Zambia has suspended the non-deposit taking microfinance institution licence of JMAAC Financial Services Limited for a period of six (6) months until March 18, 2019 in accordance with Section 17 of the Banking and Financial Services Act, 2017. The suspension of the licence was due to the persistent breach of the Banking and Financial Services (Capital Adequacy) Regulations.

The suspension of the licence entails that JMAAC Financial Services Zambia Limited ceased Mr Kanguya Mayondi to operate as a microfinance institution under the Banking and Financial Services Act, 2017 and the Banking and 2019. However, the suspension of obligations it incurred or assumed Financial Services (Microfinance) the licence did not relieve JMAAC during the period of validity of the Regulations, 2006 until March 18, Financial Services Limited of any licence.

Zambanker September 2018 11 2018 DIRECTIVES ON PROCESSING OF DIRECT DEBIT AND CREDIT INSTRUCTIONS AND FUNDS TRANSFERS

By PAYMENT SYSTEMS DIVISION 1. Direct Credits Transmission and Settlement times

The Bank of Zambia is entrusted with the responsibility of regulating, overseeing and maintaining an efficient and safe payment system in Zambia. An efficient and secure payment system * Instructions submitted after final cut off times that is 14:30 hours for electronic channels and 13:00 hours for is fundamental for manual instructions may be processed in session one of the next business day. proper functioning of the 2. Direct Debits Transmission and Settlement times economy by providing mechanisms for transfer of funds and settling of transactions, and has implications on financial stability.

n furtherance of its mandate of promoting an efficient and safe payment system in Zambia, the Bank of Zambia issued the INational Payment Systems Directives on processing of Direct Debit and Credit (DDACC) instructions and funds *A paying customer shall ensure that sufficient funds are provided on the respective account on the due date. transfers on the Zambia Interbank Payment and Settlement System 3. Zambia Interbank Payment and Settlement System (ZIPSS) Transmission and Settlement times (ZIPSS) on 31 August 2018. DDACC and ZIPSS are recognised as systemically important payment systems in Zambia whose failure would have an impact on the wider economy. It is thus imperative that DDACC and ZIPSS operate in an efficient and safe manner to support economic activity.

Under the Directives, commercial banks, Bank of Zambia and any person offering funds transfers through DDACC and ZIPSS are required to adhere to the following timelines for the processing and settlement of funds * Instructions submitted after final cut off times, that is 15:00 hours for electronic channels and 14:30 hours for transfers: manual instructions, may be processed on the next business day.

Further, section 6 of the Directives requires commercial banks, Bank of Zambia and any person offering funds transfers through DDACC and ZIPSS to ensure their customers are aware of their rights and obligations relating to funds transfers done through DDACC and ZIPSS. For further information and clarification, members of the public are encouraged to contact their respective banks.

12 September 2018 Zambanker KANKASA - MABULA INSTALLED ZCAS UNIVERSITY CHANCELLOR

By ZAMBANKER REPORTER

Deputy Governor Administration Dr Tukiya Kankasa-Mabula has been installed Chancellor of the ZCAS University. The installation ceremony was held alongside the University’s second graduation ceremony on 31st August, 2018 at ZCAS University.

Kankasa-Mabula has always worked hard to ensure that women in the workplace and in the corporate world, in particular, were not only recognised but also appreciated. ‘It is therefore my hope to see many more women being installed as chancellors of universities as this will provide positive role models for the girl- child whose participation is critically needed for our nation’s development,’ she added.

ZCAS is a statutory institution, which was established by an Act of Parliament, Act No. 1 of 1989, for the purpose of training accountants, promoting research and advancement of learning in accountancy and related studies. It has been a pillar in the training of accountants, business Dr Tukiya Kankasa-Mabula and ICT professionals for the past 28 years. The institution has evolved into a leading global accountancy, IT n her installation acceptance Ordinances. and business related training centre speech, Dr Kankasa-Mabula through the provision of high quality expressed delight at the rare ‘My role as Chancellor of ZCAS courses. ZCAS has been built on a opportunity accorded to her to University will be, to be a formidable strong foundation of professional and Iserve as chancellor of the university. ambassador for this wonderful academic excellence. She said she was greatly humbled to university. I will strive to represent have been identified among many ZCAS University at both internal The creation of ZCAS University deserving Zambians and to be counted and external academia and business responds to the country’s current need worthy of the challenge. She pledged environments. I will represent the for superior higher education. It is an to do her utmost to promote the work university’s interests within its ambit endeavour to buttress the provision of of the university and contribute to and act as its face and torch bearer,’ tertiary education to another level of raising it to the highest heights. she said. representation in the academic world.

The BoZ Deputy Chief said throughout Dr Kankasa-Mabula said she would Dr Kankasa-Mabula had no doubt her career, she has always pushed the ensure that the university forges new that ZCAS University would continue limits and aspired to do her utmost linkages and encourage undertaking with an upward path and become the best in her personal and professional of research, which would be relevant university of choice now and in the endeavors. In this regard, she pledged and contribute to finding solutions to many years to come. She believes to do her best to apply her professional the nation’s economic challenges. the university’s tag line, which is to and administrative expertise to ZCAS aspire, acquire and proposer will truly University in line with the provisions She further noted that there were be realised as all concerned play their of the Higher Education Act No. 4 of still less than a handful of university part to ensure the advancement of 2013 and ZCAS University Statues and chancellors that were women. Dr sound education and learning.

Zambanker September 2018 13 Continues from page 6 BoZ CAPITALISES DIGITAL EVOLUTION

income customer segments. She reminded banks and other skills in the industry by undertaking financial institutions that investments the institute’s various professional Dr Kankasa-Mabula further explained in digital solutions would bring programmes. that the digital footprints made down operational costs and that the in every financial transaction or benefits should always be passed Earlier Dr Kankasa-Mabula said the interaction could help financial on to customers by way of reducing year’s theme, is a very important service providers to interact more interest rates and other charges. She topic as it is consistent with the easily and adapt to the financial needs said affordable financial products and Government’s national agenda to of a diverse set of customers, thereby services were a cornerstone for the proritise digital delivery channels as allowing financial service providers economic development of any country a key driver of financial inclusion as to serve the financially excluded more and Zambia was not an exception. espoused in the national financial effectively, with a “customer-centric” inclusion strategy. approach. She urged the financial sector to ensure that no one was left behind as The national strategy whose “I want to believe that the benefits the country embraced digital financial objective is to increase overall of digital financial inclusion for the services and Fintechs. The Deputy financial inclusion from 59 percent financially excluded and underserved Governor also implored players to 80 percent by 2022 has laid out outweigh the risks involved. However, in the financial sector to continue specific actions to promote mobile appropriate mechanisms must be employing rightly qualified members based delivery platforms, achieve instituted to minimise the impact of of staff as these were able to combine interoperable retail payment systems risks associated with digitalization knowledge with innovation to develop and the digitisation of government to by enhancing cyber security, data user friendly digital financial products persons and persons to government protection and data privacy. I and services as well as devising risk payments. The prioritisation of these therefore wish to implore all the mitigating mechanisms. In particular, initiatives reflects the realisation of financial institutions to continue to she appealed to all financial the catalytic role that digital financial invest in financial technology and institutions to take advantage of the services can play in accelerating to effectively manage the associated quality training programmes offered financial inclusion, supporting risks, so that together we may speedily by the Zambia Institute of Banking & economic growth and achieving increase financial inclusion and help Financial Services and encourage their the sustainable development goals develop this country,” she explained. staff to enhance their professional (SDGS).

14 September 2018 Zambanker MONETARY POLICY STATEMENT JULY-DECEMBER 2018 This Statement provides a summarised outlook for global economic growth, domestic economic growth and inflation, and outlines the Bank of Zambia’s monetary policy objectives for the second half of 2018. In addition, the Statement reviews the performance of monetary policy during the first half of 2018.

ECONOMIC PERFORMANCE equipment, iron and steel and maintaining it over the rest of the paper products. Nonetheless, first half of the year. The statutory Global growth momentum to merchandise exports rose by 0.8% reserve ratio was reduced to 5.0% continue supporting Zambia’s to US$4,490.7 million due to higher from 8.0% over the same period. growth earnings from copper, which This policy stance was intended increased by 4.5% to US$3,455.7 to support growth and promote The projected positive global growth million. financial system stability. The Bank prospects and the associated pick- continued to conduct monetary up in copper prices are expected Inflation edges up operations aimed at maintaining to support Zambia’s growth, the interbank rate within +/-1 particularly in mining through Inflation edged up during the percentage point of the Policy Rate. increased export performance. first half of 2018, to 7.4% in June, There are, however, downside from 6.1% in December 2017, but Fiscal deficit higher than risks associated with uncertainties remained within the target range programmed surrounding Brexit and trade of 6-8%. The upward adjustment wars between the US and its major in fuel prices and the subsequent The fiscal deficit (on cash basis) trading partners. increase in transportation costs in the first half of 2018 was were the key drivers of inflation. The higher than programmed, largely Domestic economic growth seasonal reduction in the supply of reflecting higher than programmed positive, but sluggish some food items, particularly fresh expenditures on capital projects, vegetables and maize grain, also and interest payments. The deficit The domestic economy in the first contributed to the rise in inflation. was financed mainly through half of 2018 registered positive but external loans and Government subdued growth. This was reflected Interest rates remain high securities. Arrears to domestic in the fall in real GDP growth to suppliers of goods and services 2.6% in the first quarter of 2018 Despite the significant easing of were also estimated to have risen from 3.2% recorded during the monetary policy by the Bank of to K13.9 billion in March 2018 from same period in 2017. The fall was Zambia between February 2017 K12.7 billion in December 2017. mainly on account of a decline and February 2018, interest rates in growth in the agriculture and remained elevated. Lending rates ECONOMIC OUTLOOK manufacturing sectors. During the remained elevated partly attributed second quarter, however, some real to high yield rates on Government Global economic outlook positive sector indicators pointed to some securities and high non-performing improvements in economic activity loans. Consequently, the banking Global economic growth attributed to increased output in sector continued to prefer lending to prospects remain positive despite mining and selected manufactured Government, thereby constraining uncertainties surrounding Brexit products. private sector credit provision, and trade wars between the US aggregate demand and ultimately, and its major trading partners. The Trade deficit widens overall economic growth. global economy is projected to grow by 3.9% in both 2018 and 2019. In the external sector, the trade Monetary policy eased further Growth projections are anchored deficit widened further to US$742.8 on favourable global financial million during the first half of 2018 With inflation falling within the conditions, accommodative from US$309.9 million in the second target range and projections monetary policies, particularly in half of 2017. This was mainly due consistently pointing to low advanced economies, continued to a significant growth in imports inflation, the Bank of Zambia in recovery in commodity prices, relative to the rise in exports. February 2018 eased monetary and improved growth prospects in Imports grew by 9.8% mostly due policy further by lowering the Policy Emerging Markets and Developing to higher copper ores, industrial Rate to 9.75% from 10.25% and Economies (EMDEs). Story continues on page 16 Zambanker September 2018 15 Story continues from page 15 MONETARY POLICY STATEMENT JULY-DECEMBER 2018

Domestic economic outlook stable, 1.1 percentage points higher than performing loans, continued but with challenges the average out-turn of 7.0% in the over reliance on monetary policy first half of 2018. This is premised only would tend to exacerbate Real Gross Domestic Product (GDP) on elevated food prices as well as a macroeconomic challenges. Urgent is projected to grow by 4.0% in 2018, weaker Kwacha exchange rate, which and full implementation of the fiscal mainly on account of the anticipated may exert pressure on prices of both consolidation measures recently continued expansion in mining and food and non-food items. Upside risks announced by Government is, manufacturing output. However, to the inflation outlook include higher therefore, critical to containing growth is expected to remain sluggish. than anticipated food prices and fiscal inflationary pressures and avoiding Higher than programmed fiscal deficits, as well as a possible rise in further undermining the already deficits, rising Government debt, domestic fuel prices, owing to the fragile economic growth. Containing weak credit growth, and elevated non- upward movement in international fiscal deficits within programmed performing loans continue to pose crude oil prices. In addition, higher levels is also key to maintaining overall downside risks to broader and robust than programmed external debt macroeconomic stability. economic growth. service payments could adversely impact on inflation through the The Bank will, therefore, continue to Upside risks to inflation heighten exchange rate channel. closely monitor domestic and external sector developments and stands ready In the second half of 2018, annual Fiscal adjustment key to implement appropriate measures to overall inflation is projected to trend maintain price and financial system around the upper bound of the Given the high interest rate stability and ultimately support 6–8% target range, averaging 8.1%, environment and elevated non- economic growth.

Continues from page 9 KWACHA, SHILLING COOPERATE

Both Tanzania and Zambia have matters and security features. With recorded significant increases in the this Memorandum of Understanding adoption and usage of mobile money. that we will be signing this morning, it Given the increased access to mobile is our expectation that our currencies phones by its citizens, mobile money will restore their functions for store has presented itself as a game changer of value and medium of exchange, for increasing financial inclusion in with transactions being channelled both countries. through registered financial institutions. This MoU will allow those Even with these developments, the who undertake economic activities Governor said both central banks in common border areas to make were cognisant of the fact that even payments for goods and services with the growth of electronic payment originating from either country using platforms, cash continues to be a the currency of each respective home significant form of making payments. country. In addition, it will establish The use of cash therefore poses the risk formal procedures for the repatriation of counterfeiting, which both central of each other’s currency,” he said. banks must guard against. Dr Kalyalya is hopeful that the “Let us know our banknotes. You MoU will provide a longstanding may wish to note that both the Bank solution to informal foreign exchange of Tanzania and the Bank of Zambia activities and contribute to financial continuously make efforts to enhance sector development in the two the security features of our respective countries. It is also expected to reduce banknotes. The Bank of Zambia this transaction costs associated with year introduced banknotes with foreign exchange trading through the enhanced security features. The US dollar. This will in turn enhance Bank will therefore conduct currency trade between both countries. He also awareness exercises aimed at hoped that the two countries would sensitizing members of the public on soon be able to do business via the Dr Denny Kalyalya both sides of the border on currency SADC RTGS platform.

16 September 2018 Zambanker REGIONAL OFFICE HOSTS ZAMBIAN GIRLS’ 2030 INTERNSHIP PROGRAMME ...Broadening girls’ horizons in Zambia

By ZAMBANKER REPORTER

The Bank of Zambia through Regional Office has participated in the 2018 Zambian Girls 2030 Mentors’ Orientation Programme which was organised by Restless Development and supported by the Ministry of General Education (MOGE) and UNICEF Zambia. The aim of this mentorship programme was to increase the retention and transition rates of adolescent girls in the school system through career guidance.

Girls from various schools who took part in the Girls’ 2030 Internship Programme at the BoZ Offices in Ndola.

cting Manager Banking girls in May 2018 and later in August available to them, expose them to Ms Kamuti Chama 2018. The girls travelled from various positive role models who would coordinated the Bank’s schools in Northern and Southern essentially help them focus on their participation at this event Provinces to take part in a two-week future, help them set career goals Awhere eleven female BoZ employees internship programme. The mentors and increase their confidence and from various departments were were responsible for the girls and self-esteem. nominated to take part as mentors. ensured that they were given the opportunity to ‘work’ in different Apart from Ms Chama, the other Ms Chama informed the Zambanker departments, meet with different members of staff who took part in that the programme not only members of staff from the Bank and this programme were Ms Mavis provided teenage girls with training other organizations, as well as to Kampeni, Ms Pamela Msiska, Ms in life skills and financial literacy, but socialise with them outside the work Patricia Mbewa, Ms Misozi Mapala also provided a broader vision for environment. and Ms Daisy Olatunji. Others their careers. were Ms Priscilla Hachombwa, Ms The experience provided the girls Maureen Jere, Ms Edinasi Banda, During the mentorship programme, with the opportunity to learn about Ms Maureen Mulenga and Ms Rhoda the Bank hosted two groups of ten the various career opportunities Musonda.

Zambanker September 2018 17 WELL DONE!

By ZAMBANKER REPORTER The Bank of Zambia and many other organisations that are taking a lead in developing or reviewing their policies to ensure that they are gender sensitive have been applauded for their relentless efforts. In her presentation to Kupes conference delegates in Lusaka recently, Deputy Governor- Administration Dr Tukiya Kankasa-Mabula said that Zambia had already come a long way in many areas whereby it was seeing more women as university dons; more women taking up careers in science and math and an upswing in the number of global

Dr Tukiya Kankasa-Mabula corporate entities that are being led by women.

r Kankasa-Mabula added gaps also in the literacy levels of the women have an equal leadership that there had been girl child and in many other areas. voice to their male counterparts,” a rise in the level of she said. awareness on matters of “I therefore wish to urge you to Dwomen empowerment, narrowing take on the baton and challenge She called for an evolution in the gender divide, issues of equity the status quo because that is what thinking because the conventional and affirmative action to support the game change is about. You, my orthodox way of thinking and of women, a trend she said was very young compatriots, are the ones doing things had clearly failed encouraging and commendable. that can make the game change. to deliver the desired dividends. You are the next generation that She explained that it was time to However, she explained that must keep the momentum going. put on a new pair of lenses that the women folk were still under You are the generation that must leaves behind the old bureacratic, represented in many professional take the lead in creating innovative laissez- faire, prior-scripted modus pursuits including business, strategic ways in every fabric of our society operandi and embrace new ways of leadership roles and matters of so that in every place and in every working that encourage diversity governance, adding that there were sphere of human endeavour, of thought in every aspect of life. Story continues on page 40 18 September 2018 Zambanker CREDIT REPORTING ACT 2018 ...Extending the rewards of financial discipline and elimination of credit information asymmetry beyond the financial sector

We are all too familiar with the topic of credit reporting, especially with the issues emanating from the famous Savenda Management Services Limited v Stanbic Bank Zambia Limited Selected Judgment No. 10 of 2018 still commanding front page newspaper headlines. Quite apart from the Savenda case and the euphoria it causes, in this writeup, I attempt to

Mr Lungisani Zulu provide a summary of the Credit Reporting Act, No. 8 of 2018 which, though not yet operational, became law following presidential assent on 28th July, 2018. I also demonstrate how the Act extends the rewards of financial discipline and elimination of credit information asymmetry only possible with a robust reporting regime beyond the financial sector in Zambia.

irst things first, just what companies that collect credit reports any information about the borrower to is credit reporting? We can and process information on the credit properly price the cost of borrowing. quickly appreciate the meaning status of a person. The Data Privacy Credit reporting also enhances a positive of credit reporting by turning Code on the other hand provided credit culture by rewarding borrowers Fto the definition of a ‘credit report’ practical guidance to credit data users with good paying habits with a lower in the Credit Reporting Act. A credit in Zambia in the handling of credit cost and correspondingly discouraging report is defined to mean information data. It deals with collection, accuracy, delinquent behavior. Without a proper relating to the financial obligations use, security and access and correction credit reporting system, it is difficult to of a person, including the payment issues as they relate to data of a person quickly tell between a bad debtor and history of such obligations, guarantees, who has accessed credit, or has been an a good debtor. It becomes impossible publicly available information and applicant for credit. The Code also covers to know which borrower to reward any other relevant data compiled by a credit reference service providers, data and by how much. A structured credit credit reporting agency. In a nutshell, providers and authorised users in their reporting regime ultimately addresses the Credit Reporting Act 2018 therefore dealing with credit reference services the problem of low access to credit, deals with the law of collection, storage and debt collection agencies. which is a huge hindrance to the and reporting of information relating economic development of any country to the financial obligations of a person, In 2008, the Bank of Zambia went a ours included. including the payment history of step further by issuing the Banking such obligations, guarantees, publicly and Financial Services Act (Provision This far, it is therefore justifiable to available information and any other of Credit Data and Utilization of Credit categorically state that the regulatory relevant data compiled by a credit Reference Services) Directive, 2008. By regime for credit reporting in the reporting agency. these directives, it became mandatory financial sector is in place. We can for financial service providers to also state that credit reporting permits For the financial sector, credit reporting provide credit data to and utilize credit the proper rewarding of financial is not a new concept. As far back as reference agencies. discipline and elimination of credit 2006, the Bank of Zambia gazetted the information asymmetry. So what is the Credit Reference Services (Licensing) There are many reasons why a Credit Reporting Act, 2018 all about and Guidelines and the Credit Data (Privacy) robust credit reporting regime is a how does it extend the benefits of a Code. The Credit Reference Services critical component of the financial robust credit reporting system beyond Guidelines introduced a licensing infrastructure in any country. Firstly, the financial sector? regime for credit reference agencies, it eliminates informational asymmetry now styled credit reporting agencies, or gaps whereby lenders do not have The Credit Reporting Act, 2018’s Story continues on page 22 Zambanker September 2018 19 RETURN TO THE CORE

By ZAMBANKER REPORTER

Deputy Governor-Operations, Dr Bwalya Ng’andu has appealed to the banking sector to get back to its core business of financial intermediation in order to support economic development. He said this could be done through innovative structuring of products and services that meet the needs of different customers.

peaking at the official opening of the new branch of the First Capital Bank in Kitwe recently, Dr Ng’andu explained that Sthere were adverse consequences to the banking system over relying on non-core banking source of income. The major risk being lowering the credit assessment skills among staff. This can be a problem because lending is about effectively assessing and managing risk, failure to which partly contributes to building poor quality of assets reflected in non-performing Deputy Governor – Operations Dr Bwalya Ng’andu with First Capital Bank Chairperson Mr Andrew Musukwa loans (NPLs). and other senior officials arriving for the official opening of the new First Capital Bank branch in Kitwe.

Dr Ng’andu explained that following the market turbulence of 2015 and intermediaries, as is the case with manifest when it has a critical mass the subsequent tightening of the peers in the region, whose share of data from all Financial Service monetary policy by the Bank of exceeds 60.0 percent. Furthermore, Providers. Zambia, market conditions became non-core banking services, such as somewhat unfavourable for credit fees and charges constitute a higher Earlier, Deputy Governor commended extension. However, in order to proportion of the banks income, the Board and Management of First support credit growth with the averaging 21.0 percent, compared to Capital Bank Limited for taking the expectation of creating conditions some of our peers in the region who decision to expand further the bank’s conducive to stimulating greater are below 15.0 percent. In addition, branch network, which now brings economic activity, the Bank of Zambia income from securities is averaging the total number of branches in responded by easing monetary policy 20.0 percent in contrast to some of our Zambia to seven. by gradually reducing the Policy Rate peers, some of whom are as low as 3.0 and the Statutory Reserve Ratio (SRR) percent. This income should never be “As we all know, the Copperbelt from February 2017. This process a substantial part of the banks’ income Province remains a strategic region involved reducing the Policy Rate because it can easily go away which for Zambia due to the contribution from 15.5 percent to the current could have a negative impact on their that it makes to the economy of this 9.75 percent and the SRR from 18.0 balance sheets,” he said. country. Kitwe, in particular hosts a percent to the present 5.0 percent. considerable number of Small and These measures have had the effect of He elaborated that there was need to Medium Enterprises (SMEs) and improving the general level of market reflect on the role of collateral as an most of these support the mining liquidity. Unfortunately, credit growth examination of how access to credit sector. Indications are that activity has remained generally subdued. can be improved, adding that banks in the mining sector will continue to need to expand the list of acceptable increase, supported by higher copper “This is an indication that banks have collateral types. In November 2017, prices. It is also expected that activity not been as effective as they should the Movable Property Registry System in this region will equally pick up. be in playing their role as financial (MPRS), which is hosted by the Patents Therefore, entities such as SMEs will intermediaries. There are specific and Companies Registration Agency be looking to commercial banks to pointers to support this observation. (PACRA), was launched. However, the provide appropriately structured and For example, we have noticed from Bank of Zambia has noted that very affordable banking services,” he said. our analysis that banks’ interest few commercial banks are registering income from loans and advances is their movable security interests on He urged First Capital Bank to below 50.0 percent, yet this should be the MPRS. Best practice suggests that consider venturing into other parts of main source of income for financial the benefits of the MPRS will fully the country away from the line of rail.

20 September 2018 Zambanker PS VISITS REGIONAL OFFICE By ZAMBANKER REPORTER

Director - Regional Office Mr Visscher Bbuku has informed Copperbelt Permanent Secretary Mr Bright Nundwe that Regional Office (R.O) provides banking and currency services to the Copperbelt, Luapula, Northern, Muchinga and North-Western Provinces of the Republic of Zambia and facilitates trading in Government Securities to the Northern Region.

he Regional Director said this when the Copperbelt Permanent Secretary paid a courtesy call on him Tto strengthen relations between Cabinet Office and the Bank and to acquaint himself with the operations of the Regional Office.

Mr Bbuku further stated that most functions at the Regional Office mirrored those at Head Office, with Copperbelt Province Permanent Secretary Mr Bright Nundwe with Mr Mwifwa Ng’ambi, most of the departments represented Director – Levy Mwanawasa Stadium at the Bank of Zambia Regional Office. in order to enhance administrative convenience by de-centralising some of the core functions of the Bank of Zambia’s operations.

He said amongst the most critical functions that the Regional Office performed under its Delegated Authority was to;

„„ Make assessments of currency requirements for the Northern Region and the ordering of the required levels of cash to meet Copperbelt Permanent Secretary and his delegation in a meeting demand; with BoZ Senior staff. „„ Receipt, recording and safe- keeping of notes and coins from Head Office; Region, which resulted in frequent Zambezi Portland Cement Ltd, „„ Issuance of currency to consignment trips for the delivery Dangote Cement Plant, Ndola Energy commercial banks and to the and evacuation of banknotes and limited, Global Logistics, Neelkant banking office; coins. Regional Office has since Lime Plant, Trident Mine in Solwezi, „„ Receipt of currency deposits assumed the oversight of Subchest Construction of shopping malls and from commercial banks and management in the Northern modern markets, increased farming „„ Destruction and disposal of unfit region covering Kasama, Mansa and activities in Mkushi and Mpongwe. banknotes. Solwezi. All this has resulted in an Speaking during the same meeting On Economic activities in the unprecedented growth in the Mr Steven Musuku, Assistant Northern Region, Mr Musuku number of bank branches and other Director Operations informed the informed Mr Nundwe that some financial institutions. Permanent Secretary that over the of the more notable developments years, operations, at the Regional which were indicative of resurgence The Permanent Secretary was Office had been fine-tuned and that in economic activities in the Northern happy to have visited the Central the BoZ Strategic Plan (2012 – 2015), region included the operations Bank and encouraged everyone aimed at making the Regional Office a of companies such as; Lumwana present to work extra hard and fully-fledged Cash Processing Centre. Mine, Luanshya Copper Mines, KCM advise Government prudently. He This was in response to the increased and Chambishi Copper Smelters, later toured the banking hall before economic activities in the Northern Konkola Deep Mining Project, leaving the Bank.

Zambanker September 2018 21 Story continues from page 19 CREDIT REPORTING ACT 2018 express purpose is providing for the Part VI of the Act deals with the regulation of credit reporting agencies parameters for collection of credit by the Bank of Zambia; the licensing It is therefore safe to conclude information, disclosure of credit of credit reporting agencies; the that the Credit Reporting information, measures to safeguard establishment of a Credit Registry; the the security of credit information and governance and management of credit Act No. 8 of 2018 introduces retention of credit information by a reporting agencies; the protection of a robust regime for the credit reporting agency. Other issues data subjects; information sharing and under this part include the form of reporting to enable assessment of the regulation of credit reporting a credit report, credibility of credit credit worthiness of a data subject and in Zambia. Its provisions also information, what information must incidental matters. be excluded from a credit report give legal support for other and corrective measures to address A telling introduction of the Act is in its credit providers who are instances of incomplete, inaccurate or definition of a credit provider. While outdated information. the Credit Reference Directives issued not banks to provide credit by the Bank of Zambia only spoke of information and utilize credit Part VII contains various provisions the financial service providers licensed stipulating consumer’s rights and by the Bank as credit providers, who reporting agencies in their their protection in relation to credit could provide credit information and business thereby extending the information. Consumer rights include utilize credit reporting agencies in the right to a clear complainant’s their business, section 2 of the Act rewards of financial discipline procedures of a credit reporting agency, has extended the meaning of credit and elimination of credit right to information relating to the providers to include any person who credit reporting agency holding credit carries business of providing credit in information asymmetry beyond information and the right to verify the country. These include subsidiaries the financial sector in Zambia. and have credit information corrected. of a financial service provider, money Other rights include the right to be lenders licensed under the Money regulated under the Banking and notified by a credit provider of any Lenders Act, persons whose business Financial Services Act. This should adverse actions taken against you on is that of providing finance for the enhance a more robust regulation of account of credit information held acquisition of goods by way of leasing the sector. with a credit reporting agency, right or hire purchase and any person who to challenge credit information which provides goods or services on credit. This Part IV of the Act provides for the is inaccurate, incomplete or outdated. means aside from the traditional banks establishment of a credit registry to The robust and extensive consumer and other financial service providers, be operated by the Bank of Zambia. rights and protection provisions even other entities not regulated by the This is new. The credit registry is should go a long way in minimizing, Bank of Zambia have a legal basis to a database of credit information if not at all, eliminating some of the provide credit information to a credit operated by the Bank of Zambia to issues litigated in the Savenda case. reporting agency and utilize its services which all financial service providers in their business. More consumers must supply credit information. Part VIII empowers the Bank of Zambia should therefore correspondingly Additionally, other credit providers to investigate complaints relating to benefit from the rewards of financial such as money lenders and anyone credit reporting to timeously issue discipline from more credit providers else providing goods and services on any corrective enforcement notices than just banks. Provision of credit credit may be compelled to supply to redress infringements. Part IX of information from all credit providers credit information to the credit the Act provides for appeals from will result in the elimination of credit registry which shall be accessible the decisions of the Bank of Zambia information asymmetry across all to such category of persons as may to a tribunal to be appointed by the sectors of economic activity. be approved. This should be good Minister of Finance. news for credit reporting system in And what do other provisions of the the country as the credit registry will It is therefore safe to conclude that law say? operate as a backup for what can be the Credit Reporting Act No. 8 of accessed in credit reporting agencies 2018 introduces a robust regime for Part II of the Act appoints the Bank of and contain credit information from the regulation of credit reporting in Zambia as the Administrator of the Act all other sectors thereby presenting a Zambia. Its provisions also give legal while Part III empowers the Bank to broader picture of a country’s credit support for other credit providers licence credit reporting agencies. While culture. who are not banks to provide credit this is altogether not completely new, information and utilize credit what’s new is that regulation of credit Part V of the Act deals with the reporting agencies in their business reference agencies, now styled as credit Management of the credit reporting thereby extending the rewards of reporting agencies, will be done under agencies to ensure that there is no financial discipline and elimination of a completely new statute unlike before mismanagement of this sensitive credit information asymmetry beyond when credit reference agencies were industry. the financial sector in Zambia.

22 September 2018 Zambanker SUSTAINABLE ECONOMIC EMPOWERMENT

By ZAMBANKER REPORTER

The Bank of Zambia, as always, took part in this year’s 92nd Agriculture and Commercial Show which was held from 1st - 6th August, 2018 in Lusaka under the theme ‘Sustainable Economic Empowerment’.

Head of Communications Mr Kanguya Mayondi explaining the displays exhibited by BoZ to His Excellency, the President of the Republic of Zambia Mr Edgar Chagwa Lungu and his entourage when they visited the BoZ pavilion at the 92nd Zambia Agriculture and Commercial Show.

The theme highlighted the role and proactive manner. December 2017 from 7.5% in December capacity of citizens, to not only 2016 compared to a target of 9% after participate and contribute to the Macroeconomic stability and reaching a peak of 22.9% in February nation’s growth process but to also improved access to credit are key 2016. The slowdown in inflation was benefit from it in a meaningful ingredients in ensuring sustainable partly attributed to the lagged effects of and dignified manner. Sustainable economic empowerment. Zambia’s the significant tightening of monetary economic empowerment entails macroeconomic performance policy in 2015 and 2016, relative making sound public policies for the improved in 2017 as evidenced by stability of the Kwacha against other benefit of all. To this end, the role the achievement of low and stable major trading partner currencies and of the Bank of Zambia in achieving inflation, relative stability in the improved supply of food items. The and maintaining price and financial exchange rate and a pickup in Kwacha appreciated by 7.5% in 2017 system stability to foster sustainable economic activity. Economic activity to K9.53 per US dollar supported by economic development is crucial. picked up, with growth estimated increased supply of foreign exchange at 4.1% in 2017 compared to 3.8% from mining companies and foreign Price stability contributes to in 2016 and 2.9% in 2015, driven by investors in Government securities. achieving high levels of economic agriculture, mining, manufacturing as During the first half of 2018, annual activity and employment through well as tourism sectors and increased inflation edged upwards to 7.1% in increased investor and consumer electricity supply. Higher copper March and subsequently to 7.4% confidence in the economy while export earnings, supported by buoyant and 7.8% in April and May 2018 on financial system stability facilitates copper prices and a ramp up in account of the upward adjustment the smooth transformation of savings production contributed to the strong in fuel prices and the subsequent into investments, efficient settlement improvement in the trade balance. increase in transportation costs, and a of payments and ensures that risks seasonal reduction in supply of some are managed in a satisfactory and Annual inflation declined to 6.1% in food items, particularly vegetables Story continues on page 42 Zambanker September 2018 23 PHOTO FOCUS

Director – Board Services, Ms Namwandi Ndhlovu welcoming the Republican President H.E. Analyst - Payment Systems Overnight Ms Waza Nguni showing a former BoZ employee, Mr Edgar Chagwa Lungu to the BoZ pavilion at 92nd Agriculture and Commercial Show in Mr Winston Siwale the new security features introduced on the Zambian banknotes. Lusaka, while Head Communications – Mr Kanguya Mayondi looks on.

Deputy Governor – Operations, Dr Bwalya Ng’andu presenting a cash prize to one of the Deputy Governor – Operations, Dr Bwalya Ng’andu performing the ‘Nc’wala’ dance quiz winners at the 92nd Zambia Agriculture and Commercial Show in Lusaka. with the Ngoni traditional dancers.

Manager - Currency Mr Patrick Phiri showing his H.E Mr Edgar Chagwa Lungu and his Ms Cleopatra Ngoma, a Records Officer in Economics Department explaining economic entourage the new features that have been introduced on the Zambian banknotes. This was charts to showgoers who visited the BoZ stand. in the BoZ pavilion at the 92nd ACSZ

Assistant Director - Operations Mr Steven Musuku (second from left) with Regional Office Deputy Governor – Operations, Dr Bwalya Ng’andu officially opening the staff at the official opening of a First Capital Bank branch in Kitwe. First Capital Bank (FCB) branch in Kitwe.

24 September 2018 Zambanker PHOTO FOCUS

Head - Communications – Mr Kanguya Mayondi giving a presentation to Republican President H.E. Mr. Edgar Chagwa Lungu sharing a light moment H.E. Mr Edgar Chagwa Lungu during his tour of the BoZ pavilion at the 92nd ACSZ with Senior Economist Dr Frank Chansa.

The BoZ and BoT Governors dispaly MoU to the audience. Cultural group celebrate the currency exchange programme

The BoZ and BoT Governors signing the MoU on currency convertibility and repatriation. Head - Communications – Mr Kanguya Mayondi sharing a light moment with President Lungu and Minister of Agriculture Mr Michael Katambo (l).

(l-r) Manager - Vaults Management Mr Lincoln Matenga Assistant Director - Operations Mr Steven Musuku, Regional Director Mr Visscher Bbuku and The Zambia Girls 2030 Internship Programme participants with some BoZ employees Assistant Director – Administration Mr Diana Chisulo in a meeting with the Copperbelt PS Mr Bright Nundwe (not in picture) in the Regional Office Boardroom.

Zambanker September 2018 25 REVISED CHARGES, FEES DIRECTIVES EXPLAINED

The purpose of the account opening balance. to the normal fee. explanatory notes is to 2. Charge for over-the-counter cash For instance, when a customer uses deposits and charge for over-the- an ATM of another bank to withdraw provide clarification counter withdrawals (where the funds, he shall not be made to pay an to the reader on the amount and or denominations being extra charge. The customer should only meaning of the listed withdrawn cannot be dispensed by be charged the normal and applicable the ATMs) fee for use of ATM services. Financial unwarranted charges service providers have already agreed and fees Directives in This refers to a charge for making cash on interchange fees amongst themselves deposits and withdrawals over-the- to compensate the ATM owner for the order to ensure common counter. This includes bulk deposits and running costs arising from use of the understanding. It is withdrawals. ATMS by non-customers. Such charges are unwarranted as the recognized that the act of taking deposit and paying out This charge should not be construed to charges and fees may be withdrawals is a core function of any be the same as ATM charges that are known by different titles deposit taking institution. Deposits from imposed for usage of ATM services. The the public are the main source of funds regular ATM charges are not covered in different institutions for financial service providers. The under these Directives. and not as referred to financial service providers invest these funds in income earning assets hence 5. Charge for cash deposit on ATM in the Directives. In this costs relating to deposit mobilization, regard, a financial service including cash handling, are recoverable ATMs of some financial service provider shall not apply from the income earned (e.g., interest providers have a provision for taking rate charged on a loan) when the deposits. There shall be no charge or fee any charge or fee listed customers’ deposits are invested in for depositing cash at the ATM. below, or whatever other interest earning assets. 6. Charge for Aborted ATM cash term such charges may be In addition, cash deposits on automated withdrawals referred to as, provided it teller machines (ATMs) are limited due to the deposit thresholds, besides security A customer shall not be charged for an falls within the described reasons. While the Bank of Zambia ATM transaction that has been declined category. supports technological innovations such or not completed, if the fault is not as deployment of ATMS and other digital with the customer but with the service he Directives apply to both platforms, customers who opt to make provider. Zambian Kwacha and foreign withdrawals over the counter should currency denominated not be penalized when the ATMs cannot 7. Charge for ATM pin re-set transactions and/or accounts. dispense their preferred amount and TFurther guidance is that there shall be denomination, or there are long queues When a customer decides to reset their no differentiated approach for retail by the ATMs. personal identification number (PIN) at and corporate clients. The Directives the ATM, there shall be no charge for apply to all market segments of all the 3. Charge for cash deposit made by such an activity. financial service providers. third party into customer’s account 8. Charge on basic savings account UNWARRANTED CHARGES AND FEES When the account holder instructs (without cheque book) operating third parties to deposit funds into their within contractual terms 1. Charge for account opening for account, there shall be no charge for both local and foreign currency such a transaction. Where a customer operates their basic savings account within the agreed A customer shall not be made to pay or 4. Automated Teller Machine(ATM) terms and conditions, there shall be no charged any fee at the time of opening Surcharge monthly charges whatsoever on such an account, or before an account which For this purpose, ‘a surcharge’ means accounts. Ordinarily, a basic savings was previously closed for any reason, an extra charge or fee levied on a non- account will have specific conditions is re-activated. The customer shall only account holder of a financial service to it, such as how many withdrawals be required to deposit the minimum provider for use of its ATM, in addition can be made per month. In this regard,

26 September 2018 Zambanker provided the account is operating from one branch to another branch Where a customer has not a received a within agreed terms and conditions, of the same bank free monthly statement, he shall not be there should be no monthly charges or charged if he requests for a statement fees to the account, which in many cases There shall be no charge for the transfer upon closure of his account covering end up eroding the customer’s savings. of funds from an account in a branch to transactions for the previous month up another branch of the same financial to the time of closure. A Basic Savings Account is an interest service provider. Charges shall be bearing savings account, primarily to borne by the merchant as agreed with 17. Charge for monthly account promote savings and financial inclusion the financial service provider, and not statement (customers are entitled to in general. In this regard, the account customer. a free statement per month) has low opening and minimum account balances, allows limited withdrawals/ 12. Point of Sale transaction (own Unless a customer has received a free debits in a month (either directly bank customer and other bank monthly account statement, there shall through the branch, ATM or through customer) be no charge when they request for electronic transfers) and no charges one. A customer may only be charged so as to encourage saving without This refers to a charge for use of a Point if they request for another copy of their imposing a burden of charges or fees on of Sale (POS) machine to purchase goods statement of account after receiving a the customer. and services. There shall be no charge free statement for the month. to a customer for swiping on a POS For purposes of these Directives, the machine to pay for goods and services 18. Charge for balance and other following features shall apply for a basic account enquiries by the customer savings account: 13. Additional charges arising from over the counter or any electronic an initial charge generated by the platform „„ Low opening and minimum account bank (where a customer’s account balance; has been overdrawn by a debit Where a customer makes an enquiry „„ Interest rate mechanism that covers transaction initiated by the bank on any banking transaction or requests inflation; for his account balance over the „„ Not more than at least two Where a customer’s account has been counter, or using electronic means withdrawals/ debits in a month, overdrawn by a debit transaction such as mobile banking or internet otherwise charges applicable to a initiated by the financial service banking or through the ATM, there regular savings account may apply provider, the customer shall not be shall be no charge. as contained in the bank’s tariff penalized for the overdrawn account guide; because the entry was generated by the 19. Initial debit card issuance fees „„ No monthly maintenance fees; and financial service provider. „„ No other fees. When a financial service provider 14. A charge for closure of a customer’s issues the initial debit card, there shall 9. Monthly maintenance fees on basic account which has operated for more be no charge to the customer. Further, savings accounts (without cheque than six months when a financial service provider book) undertakes to replace its debit cards There shall be no charge at all for for any reason, the customer shall The charging of maintenance fees on closure of customer accounts, unless not be made to pay for the new card. a basic savings account is prohibited. the account has operated for less than However, where a customer has lost or In most cases, a basic savings account six months. This prohibition is aimed damaged the card, replacement costs will have low opening and minimum at promoting ease of mobility for may apply. account balances which are available customers who are not satisfied with the to the bank for investment, hence such service they are currently getting from 20. Debit card maintenance and charges are unwarranted as they only their institutions to other institutions. renewal fees (annual, quarterly or lead to erosion savings. Further, the Customers may however, be required monthly) limitation on the number of withdrawals to give their financial service provider per month in a way already acts as a notice of closure of account and the Where a customer has a debit card, charge to the customer. notice required shall not exceed one there shall be no fee or charge for week. maintenance of the card, by whatever 10. Charge for transfer of funds term such charges may be referred between retail accounts domiciled in 15. Charge for reactivating a bank to. Further, there shall be no charge the same bank account for renewal of a debit card. However, where a customer has lost or damaged There shall be no charge for the transfer There shall be no charge to a customer the card, replacement costs may apply. of funds from one account to another for reactivating an account that has within the same financial service been dormant or previously closed. 21. Charge on inward local fund provider; either to another account of transfers including on RTGS system the same customer or to a different 16. Charge for statement of account and Electronic Fund Transfer (EFT) account holder. upon closing of the account, provided the customer has not received a free Where a customer receives funds 11. Charge for transfer of account statement for the month electronically, there shall be no charge

Zambanker September 2018 27 for receiving such funds in the account. collect a fee when carrying out a charge any fee based on the number of standing order instruction. Any transactions on a customer’s account, 22. Charge on inward international amendment to or cancellation of the known as transaction fee, activity fee, funds transfer where the remitter instruction should therefore, not turnover fee, or whatever other term bears the full cost attract any additional charge. such charges may be referred to as. 24. Ledger fees per entry on account In instances where the international or savings account 26. Fees on debit transactions remitter has paid the cost for sending the funds, the recipient shall not bear extra This refers to a charge for each entry This refers to a charge for each debit costs for receiving the funds into their on the savings account. In any case, entry on the account. It has been account. In this regard, the recipient financial service providers no longer observed that some financial service should receive the full amount remitted. use ledgers. Such charges or fees are providers charge their customers for prohibited. debit transactions. These relate mostly 23. Charges for amendment or to cheques issued on their account. cancellation of a standing order 25. Commission on turnover The prohibition does not include activities on the account requests from customers for banking Financial service providers normally A financial service provider shall not transactions that come at a charge.

BoZ NEW TELEPHONE LINES

The Bank of Zambia wishes to inform you that the Bank’s telephone numbers have changed. In order to gain access to the Bank of Zambia, the new telephone numbers are as follows:

ZAMTEL Bank of Zambia (Head Office, Lusaka) +260 211 399300 Bank of Zambia (Regional Office, Ndola) +260 212 399600

AIRTEL Bank of Zambia (Head Office, Lusaka) +260 971 270090 Bank of Zambia (Regional Office, Ndola) +260 971 270120

MTN Bank of Zambia (Head Office, Lusaka) +260 963 884820 Bank of Zambia (Regional Office, Ndola) +260 963 885580

Issued by:

Head of Communications Bank of Zambia P.O. Box 30080 LUSAKA

28 September 2018 Zambanker SEXUAL HARASSMENT POLICY ...towards zero tolerance to sexual harassment

By FEBBY MULAMBIA

The Bank of Zambia developed a policy on Sexual Harassment which was approved by the Board of Directors on 28th June 2018. This entails that BoZ has a zero tolerance policy on sexual harassment. The sexual harassment policy is one major outcome of the BoZ Gender Policy of 2001, revised and updated in 2017 and Strategic Objective Number 5 “Mainstreaming Gender Issues across work programmes and human resources” enshrined in the Strategic Plan of 2012 -2015 and rolled over to 2019.

n the Bank of Zambia context at promoting awareness on how to 5. Investigate Sexual Harassment “Sexual Harassment is prevent and mitigate the negative Cases and ascertain their defined as: unwelcome sexual impacts of sexual harassment in authenticity for escalation advances, requests for sexual the workplace. Sensitisation and Ifavors, and other verbal or physical Knowledge sharing on the policy To strengthen the role of Sexual conduct of a sexual nature when will continue until the information Harassment Counsellors, Bank either: to curb the vice is appreciated by of Zambia has engaged YWCA to all stakeholders involved in the conduct the training on Counselling „„ The conduct is made as a process. Skills and Handling Sexual term or condition of an Harassment Cases. The training individual’s employment, Further, the Bank has appointed will be for a period of five (5) days career advancement or access and trained Departmental Sexual after which the Counsellors will to work related rights and/or Harassment Counsellors who be attached to YWCA for another opportunities. will handle sexual harassment period of five days for practicals. „„ The acceptance or refusal of complaints and cases in Departments such conduct is used as the basis and the Bank at large in accordance The Bank is placing emphasis on or a factor in decisions affecting with the Sexual Harassment Policy the matter because there are overt an individual’s employment. guidelines and regulations. and covert implications of sexual harassment to both the employee Undoubtedly, such conduct Roles and responsibilities of and the Bank. Sexual harassment unreasonably impacts an Departmental Sexual Harassment causes serious psychological individual’s employment or creates Counsellors include the following: trauma, stigmatization and self- an intimidating, hostile or offensive blame, ridicule and isolation to the environment for that individual’s 1. Receive Complaints from victim. This causes stress and poor employment, working environment, victims of the aforementioned work performance and impacts or participation in work related vices; negatively on the wellbeing of activities. employees, therefore the Bank is 2. Counsel victims of Sexual committed to the maintenance of a Following approval of the Policy, Harassment & Gender Based working environment that is free a number of activities have Violence; from fear, intimidation and sexual been undertaken to promote harassment. From the external zero tolerance towards sexual 3. Conduct one on one sensitization point of view, Sexual Harassment harassment talks with employees and dents and negates the publics’ view of an institution causing people to All employees were sensitised 4. Uphold the provisions of Sexual lose confidence in the organisation’s on the provisions of the sexual Harassment Guidelines in the ability to effectively provide harassment policy. This was aimed workplace intended services. A conducive

Zambanker September 2018 29 environment, free from sexual short term contracts of employment of every employee to make Bank of harassment is a right for every and members of the public who Zambia a sexual harassment free employee. have direct or indirect links to organisation. or business with the Bank. All The Sexual Harassment Policy will employees are encouraged to take The Author is Manager – Learning apply to all employees at all levels heed of the provisions of the policy. and Development in the Human of the Bank including employees on Remember it is the responsibility Resources Department

SEXUAL HARASSMENT COUNSELORS SEXUAL HARASSMENT COUNSELORS

Serial No. First Name Surname Department 1 Brenda Mwanza Economics 2 Kamwi Mulele Economics 3 Waza Munkombwe Banking 4 Nondo Musonda Banking 5 Mwaka Shimabale Human Resource 6 Nomsa Chinunda Human Resource 7 Nelly Cheelo Human Resource 8 Chingeni Ndhlovu Financial Markets 9 Florence Pandala Finance 10 Lastone Lukanda Finance 11 Harry Mulenga Regional Office 12 Stella Phiri Regional Office 13 Brian Mulenga Regional Office 14 Stella Nkhoma Strategy & Risk 15 Musonda Kasoma Strategy & Risk 16 Moffat Banda Board Services 17 Silvia Siwale Board Services 18 Tobais Mapenda Procurement 19 Fwila Chipalo Procurement 20 Melina Malipilo Non Banks 21 Luka Mhango Non Banks 22 Lungisani Zulu Legal 23 Clement Mweemba Legal 24 Bornwell Shabwalala Bank Supervision 25 Mable Sikanyika Bank Supervision 26 Gloria Chongo Security 27 Luka Chiwowo Security

30 September 2018 Zambanker CORPORATE BRAND SAFETY IN THE ERA OF FAKE NEWS

By LWANGA MWILU

Social media has placed a world of information and connections at our fingertips – literally, enabling new realities and possibilities. For businesses, social media provides additional avenues of communication and real-time engagement with various stakeholders, opportunities for enhanced brand visibility and recognition, and ability to potentially reach otherwise excluded audiences. With so many individuals and businesses, including industry leaders, on Ms Lwanga Mwilu board, social media can aid research for brand development through audience feedback and benchmarking. It can also be a good place to find new talent for staff recruitment and, depending on the nature of the business, a source of revenue.

ith its power to make influence public opinion, undermine undermine democracies, economies things viral, social institutions, or grow website traffic and businesses. Businesses continue media can take a brand and in turn advertising. A clickbait is a to be targeted by fake news with real- – corporate or personal strategically placed link that often leads world effects. Pepsi, for example, W– from obscurity to global focus to factual news but the accompanying faced severe backlash when an article overnight. This can be an advantage or headline or social media description is falsely quoted then CEO Indra Nooyi disadvantage depending on the reason so exaggerated or misleading that it falls telling presidential candidate Donald for going viral; the reason is often the in the category of spreading fake news Trump supporters ahead of the 2016 crucial difference between an enjoyable for clicks/advertising income. Satire, as elections “to take their business spotlight and crisis management. a genre, is also a big source of fake news elsewhere”. The backlash included With the rise of fake news in a viral even though that is not the intention. widespread calls for a Pepsi boycott. environment, many brands have Many people fail to appreciate satire Another fictitious story had claimed found themselves firefighting for no and take information from sources a Pepsi member of staff injected HIV- reason of their making. While social such as parody accounts seriously and infected blood into Pepsi products. media did not create fake news, it has consequently end up misinformed/ Both examples show scenarios where been the biggest enabler to date and misled. damage to a brand’s reputation comes the practice has grown exponentially. with potential loss of revenue. It also Zambia, for example, has over the years Sometimes an organisation’s social entails extra cost in terms of time increasingly seen information that is media can be compromised and and financial resources for crisis not even remotely grounded in reality inappropriate content shared or false communications. go viral. announcements made, which then serve to misinform. What is also In Zambia, unscrupulous people have What is fake news? common, however, is businesses and advertised non-existent job openings prominent individuals sometimes in companies they have no affiliation In essence, ‘fake news’ is an oxymoron posting problematic content and once to and the public respond, sometimes as accuracy is one of the qualifications faced with a public backlash, attempting overwhelmingly. By the time affected for news and if information is fake then to shirk responsibility by claiming they companies come on board to correct it can be anything – misinformation, were hacked and the offending material this, sometimes personal information propaganda – but news. It is, however, was shared with neither their approval will have already been shared. Just generally used as a catch-all phrase nor participation. It is also common to in October 2018, three people were for misinformation/ fabricated attempt to discredit dissenting views arrested for impersonating public information, propaganda, hyperbole or true but damaging information by officers and swindling members of the and a range of other doubtful labelling it fake news. public out of K18, 000.00 in a fictitious information. There is consensus that job recruitment exercise. fake news is deliberately shared with the Impact of fake news on business intention to misinform. The motivation How can businesses combat fake for sharing can range from trying to Fake news has the potential to news?

Zambanker September 2018 31 Ideally, audiences should be able to opportunities to ‘listen in’ and track twitter) is not possible (it is the platforms’ filter out fake news and tell parody where they are being mentioned and prerogative), a business can create from fact but that is not the case for what is being said. Your preparedness and communicate other verification everyone. Low media and information will only fully count if you act promptly features e.g. “all statements will be on literacy, confirmation bias and echo and one way of ensuring that is by being letterhead, carry this watermark/stamp chambers (‘walled’ online communities, aware of the fake news as it happens. A and be posted simultaneously across disconnected from competing/opposing good strategy combines social listening our online platforms”. This kind of viewpoints, where shared ideas and with media monitoring. Ideally, your communication would help audiences beliefs are reinforced and amplified) monitoring service should deliver alerts identify statements falsely attributed to are some of the factors that fuel the when your company’s name or other your organisation. continued rise of fake news. selected keywords are mentioned. v. Keep public records Outside of ongoing policy, media and iii. Stick to quality media tech efforts to curb fake news, what can Sometimes ‘fake news’ can arise from businesses do to protect their image Sometimes businesses can unwittingly distortion of an actual statement. In online? Some suggestions: ‘endorse’ fake news by advertising on addition to the traditional ways of online media that are purveyors of the giving information to media such as i. Be Prepared same. If, for example, you were to see written statements, press briefings a Bank of Zambia advert prominently etc, share the same on your social If targeted by fake news, the worst featured on a site that has carried a fake media platforms. In the event of being a business can do is nothing. A fake or sensationalist story on the economy, genuinely misquoted/quoted out of news attack scenario must be included you are likely to attach more credibility context or maliciously misinterpreted, in crisis management plans and to that news than it actually deserves. it need not become your word against responsible staff ready to implement In the same way, be mindful what your another as you can easily point the the planned response in real time. The business accounts share/retweet and public to your statement or broadcast faster you issue a statement to deny the from where. Sometimes fake news gets in its entirety. false news or, where possible, demand into “credible” circles just by being a takedown of the post, the better shared. Businesses remain vulnerable to false your chance of containing the spread. news and while these challenges and Good practice is to not republish the iv. Protect your stakeholders risks cannot be eliminated in this offending content and instead focus on fast-paced digital world, strategy and countering it. By getting social media accounts/pages vigilance can go a long way in protecting verified, businesses safeguard both their brands. ii. Do not be the last to know interests and their audience’s because they provide a way of distinguishing The author is Manager – Businesses must be deliberate about themselves from impersonators. Where e-Communications in the Board their presence online and utilise all official verification (e.g. blue tick on Services Department. CREDIT REPORTING ACT ASSENTED By ZAMBANKER REPORTER

he Credit Reporting Act was seven years. or credit-like activities; customisation of assented to by the President on contemporary international practices to the 28 July 2018. The Act provides In addition, the Act creates a clear Zambian environment. This has included a robust legal framework for legal framework for the sharing of consideration of recommended practices Tthe effective and efficient assessment credit information across all economic by the World Bank and the Organisation for of a borrower’s character by providing sectors by providing for: clarity on the Economic Co-operation and Development for the establishment, oversight and rights and obligations of data subjects, (OECD) countries. Consequently, Zambia is operations of credit reference agencies credit providers and credit reporting now considered as the premier reformer in Zambia. agencies. This includes clarity on consent in Sub-Saharan Africa on the World Bank’s provisions in respect to positive and ease of getting credit category for 2018. The Credit Reporting Act now limits the negative data (which was a concern in Therefore, the enactment of the Act cements period that the debt information of a respect of the case of Savenda versus Zambia’s position in Africa and the World. borrower can be retained in a credit Stanbic Bank which was deliberated report after the final payment on a in the High Court of Appeal and finally The Credit Reporting Act, therefore defaulted debt is made, to three (3) the Supreme Court); extension of the provides a robust legal framework for years from the current seven (7) years. application of the credit reporting law to an effective, efficient and integrity-based Whereas credit information on a creditor entities outside of the financial sector. credit reporting framework which should who has failed to settle a defaulted loan ultimately result in increased access to will be retained in a credit report for a The Act has provisions that would apply finance by reducing the cost of assessing period of five years from the current to all economic entities involved in credit the character of borrowers.

32 September 2018 Zambanker 2018 ELECTRONIC MONEY ISSUANCE DIRECTIVES

By PAYMENT SYSTEMS DIVISION

In April 2018, the Bank of Zambia revised the National Payment Systems Directives on Electronic Money Issuance (E-money Directives). The first Electronic money issuance Directives were originally issued in 2015. The revision of the E-money Directives was aimed at harmonizing them with developments in the payment systems area, and to create a stronger enabling environment for increased financial inclusion through promotion of digital financial services throughout our country.

he E-money Directives apply which govern the conduct of E-money services being offered and the to any person conducting in Zambia include the following: associated risks; or offering to conduct the „„ An e-money institution may be services of issuing electronic „„ The Bank of Zambia regulates the allowed to distribute or redeem Tmoney (e-money) in Zambia. The conduct of E-money services in electronic money through a e-money Directives define ‘e-money’ Zambia; Distributor or Agent; and also commonly known as ‘mobile „„ Any person intending to issue „„ An e-money institution is required money’ as an electronic store of e-money in Zambia is required to have a complaints handling monetary value as represented by a to apply for licensing or procedure and this should be claim on its issuer that is: authorisation to the Bank of placed in a conspicuous place in Zambia; all its branches and agents’ place 1. Issued on receipt of funds in an „„ An e-money institution, which of business. amount no lesser in value than is an entity licensed to conduct „„ Mobile money offers a number of the value of the e-money issued; e-money services in Zambia, is benefits including the following: required to hold all customer „„ Convenience – it can be used to pay 2. Stored on an electronic device; funds in a Holding Account for for utility bills from the comfort the purpose of safeguarding of your home e.g. electricity, 3. Accepted as a means of payment customer funds; water bills, pay television and by persons other than the issuer; „„ A Holding Account is a bank purchase of airtime. Can also be and account held in trust by an used to pay school fees and other e-money institution, in which an goods and services; 4. Redeemable upon demand for e-money institution holds all the „„ Safer – consumers no longer cash denominated in Zambian funds received from customers need to assume risks associated Kwacha. and agents; with cash; „„ e-money transactions are subject „„ Fast as they are done in almost Its monetary value is stored to transaction and balance limits ‘real time’; electronically on receipt of funds, as prescribed by the Bank of „„ Reduces costs; and and is used for making payment Zambia. The transaction limits „„ Availability of audit trail and transactions. E-Money can be held are set in a tiered manner in line account history. in various forms including on a card, with perceived risk; device, or on a server. Examples „„ A customer may hold more than For further information and include electronic purses / wallets, one wallet with an e-money clarification, a copy of the National such as Airtel Money, MTN Money, institution as long as the Payment Systems Directives on Zamtel Kwacha, pre-paid cards, or aggregate value of all the wallets Electronic Money Issuance is web-based services. does not exceed the prescribed available on the Bank of Zambia limit; website, (http://www.boz. Some of the salient features of the „„ An e-money institution is zm/201802Directive-NationalPaym National Payment Systems Directives required to ensure its customers entSystemsDirectivesonElectronic on Electronic Money Issuance 2018 have a good understanding of the MoneyIssuance.pdf)

Zambanker September 2018 33 MUFUZI WINS BEST PERFORMING PURCHASER AWARD

By ZAMBANKER REPORTER

Acting Manager Procurement and Stores Mrs Valerie Mufuzi has been awarded the Best Performing Purchaser in the Public Sector in the Women’s Category. She was conferred with the award at the sixth Zambia Institute of Purchasing and Supply (ZIPS) National Conference in Livingstone recently.

Mrs Mufuzi did not apply for any award Category award. but was nominated for consideration. Mrs Mufuzi revealed that what may ‘To my colleagues in PMS, let us have contributed to her getting the soldier on in our continued effort to award were her contributions to the demonstrate consistent performance procurement profession through in terms of delivering value for offering free and sound consultation money, saving costs and efficient on procurement matters; belonging execution of duties to ensure projects to a Procurement unit that has are successfully implemented demonstrated compliance to the ZPPA in accordance with stakeholder Act and Procurement Regulations and expectations,’ she said innovations within the prescription of the Law and her continued exhibition ‘I most sincerely thank my family, in of self – discipline, a fact that resulted particular, my husband Fred Mufuzi, in her receiving yet another important our lovely children Mwaka, Pezo and award at the Bank, in the category Maimbolwa and my father for helping of the Most Disciplined employee in me reach a stage where I can proudly 2015, among other things. hold up this award as a mark of my achievement. I also promise to get Mrs Mufuzi expressed gratitude for better at my work to earn more of such the award saying she was pleased to awards. I thank Jehovah God for giving join past supply chain professional me such a wonderful family and an recipients whom she had admired and opportunity to work for this Bank,’ she respected. ‘A very special thank you concluded. to the Awards Selection Committee for choosing me and an enormous The various categories where awards salute to all of this year’s nominees, were given at this ceremony were: Ms Valerie Mufuzi each of who have made incredible contributions to the supply chain „„ Best Performing Purchaser in the profession. I am earnestly grateful for Public Sector – Men’s Category The award was in recognition of her the recognition I have received for „„ Best Performing Purchaser in the contribution to the Purchasing and my work, because I am very sure that Public Sector Women’s Category. Supply profession. The award was the every other nominee for this award „„ Best Performing Procurement first of its kind in honour of individuals was as capable if not more of winning Unit (Public Sector) and teams from the ZIPS membership this award,’ she added. „„ Best Performing Procurement Unit who have played a significant role or (Private Sector Nonprofit Making) have made an outstanding contribution The Acting Manager further thanked „„ Young Procurement Professional to the employing organisation. the Bank of Zambia Management of the Year and in particular, the Procurement „„ Most Improved Procurement The Zambia Public Procurement Unit for continued exhibition of Operation Authority (ZPPA) sponsored the professionalism and demonstrated „„ Most Effective Use of Innovation awards. Mrs Mufuzi’s award was in compliance to the ZPPA Act and in Procurement the category of public procurement. Procurement Regulations and „„ Overall Best Male Graduating innovations within the prescription Students- Diploma ZIPS ZIPS members were invited to apply for of the Law. She said the aim should „„ Overall Best Female Graduating the awards in various categories and now be to get the Best Performing Students- Diploma ZIPS showcase their achievements, however Procurement Unit (Public Sector) „„ Presidential Recognition Awards.

34 September 2018 Zambanker EFFORTS TOWARDS ENHANCED FINANCIAL CONSUMER PROTECTION By MOSES MUSANTU

The enactment of the Banking and Financial Services Act (BFSA) No. 7 of 2017 provides a stronger financial consumer protection legislative framework that will contribute to fostering a more balanced relationship and reduction in information asymmetry between financial service providers and consumers. The BFSA Moses Musantu 2017 builds on its predecessor by providing more consumer protection and anti-competitive trade practice provisions that aim to raise information disclosure and transparency of financial products and services, prohibiting unfair and misleading marketing practices, promoting fair treatment of consumers, and establishing standards for the handling of internal consumer complaints and external dispute resolution.

Delegates who attended the Credit Infrastructure and Financial Consumer Protection sensitization workshop in Kawambwa

s it is commonly held, the Bank of Zambia’s reputation and consumer rights and obligations. regulation is meaningless desire to meet financial inclusion and without effective and stability goals. In addition the existence It is in view of the above that the Bank efficient supervision. It is of a strong consumer protection of Zambia as per its Strategic Plan for Athus critical that consumer protection framework is not comprehensive 2016 to 2019 is currently reviewing provisions of the BFSA are adequately if financial consumers are not its supervision function in order to enforced as this has implication on sufficiently empowered about their cater for consumer protection and

Zambanker September 2018 35 market conduct. The main pillars of have been abrogated by the financial 6. How to Report a Consumer the consumer protection and market service providers has potential to Complaint (with emphasis on conduct framework will include erode consumer confidence and trust consumers reporting to the regulation, oversight and consumer in financial markets, which in turn can financial institution before education. For the purposes of this negatively affect financial inclusion, escalating the complaint to Bank article, focus will be placed on financial sustainable (financially inclusive) of Zambia when not satisfied); consumer education. economic growth and financial stability objectives. Without strong consumer 7. The importance of the Key Facts Consumer education is significant confidence, economic growth may Statement; as it equips consumers with the be adversely impacted as consumers knowledge, skills, attitudes and resort to traditional and personal 8. What BoZ is doing to enhance behaviours required to act in their means of saving (e.g. storing cash at Financial Consumer Protection best interest, and to select and use home). From a consumer protection Supervision; financial services that best meet their supervisory perspective, non- needs. Together, consumer education reporting of consumer complaints may 9. Tips for Consumers before, during and consumer protection build public impair the identification of financial and after a sale; and confidence in financial institutions service providers which should be and enhance the understanding and classified as “high risk” under the risk- 10. General Principles for Financial communication of customer needs based supervision framework where Service Providers. to financial service providers, thus complaint data is a critical indicator. encouraging financial inclusion. The The Bank of Zambia also took time to Bank of Zambia has observed that The Bank of Zambia in recognition of respond to questions on various issues many financial consumers, especially the critical role of consumer education relating to consumer protection as well in the rural areas, are not aware of the conducted Credit Infrastructure as general operations of the Central dispute resolution process and where and Financial Consumer Protection Bank. For instance, some participants to report their complaints in an event sensitisations in twenty (20) rural wanted to find out what the Bank they have been unfairly treated by based districts. Some of the districts of Zambia was doing to ensure that a financial service provider. This is sensitised include: Mpongwe, Zambezi, there was consistent availability of confirmed by the World Bank Financial Luangwa, Kalomo, Lundazi, Nchelenge, network connectivity at financial Capability Survey conducted in 2016 Mpulungu, Senanga, Itezhi Tezhi service providers especially in relation that revealed that 13% of Zambians and Chama. The sensitisations were to operation of automated teller experienced conflicts with a Financial conducted in collaboration with the machines in rural areas. Furthermore, Service Provider in 2015 and just 25% Patents and Companies Registration participants wanted to find out how the of these adults attempted to resolve Agency with financial support Bank of Zambia can help to ensure that the dispute. The Survey established from the Rural Finance Expansion lessons learnt during the sensitisations that the most frequent action taken by Programme. More than 1,100 were implemented in view of the adults who tried to solve their dispute stakeholders who included district existing challenges in banks/financial with a Financial Service Provider was administration leadership, civil institutions such as but not limited to: to stop using the service before the servants, financial service providers, inadequate number of banks/financial contract ended. On the other hand, district business associations, institutions, limited manpower as well the main cause for inertia by adults farmer’s unions, markeeters, micro, as liquidity shortages. who did not try to solve disputes small and medium enterprises were with financial service providers is the sensitised on financial consumer Among other concerns received, some lack of awareness of the appropriate protection. The major topics discussed participants requested the Bank of Government Agency to contact. under financial consumer protection Zambia to ensure that financial service included but were not limited to: providers provided their customers Furthermore, the Information, with timely and accurate information Communication and Technology Survey 1. Functions of the Bank of especially on interest rates and conducted in 2015 also revealed that Zambia in relation to consumer ancillary charges. It is thus envisaged only 19 percent of the digital financial protection; that this awareness raising activity will services users in Zambia were aware help financial customers to stand up of the existence of channels of redress 2. Financial Consumer rights and whenever their consumer rights have for dealing with complaints related to obligations; been violated. The Bank of Zambia also digital financial services. The majority hopes that the participants will act as of these individuals, constituting 73 3. Responsibilities of Financial ambassadors on financial consumer percent of the individuals that said Service Providers; protection and will take time to they are aware of some channels of sensitise other people who did not redress, indicated that they would seek 4. Common Financial Consumer attend the sensitisations. redress with the service provider for Complaints; any challenges associated with digital The author is Senior Analyst financial services. 5. Consumer Protection and Anti- – Consumer Protection and Competitive Provisions contained Market Conduct in the Non-Bank The lack of knowledge by consumers in the Banking and Financial Financial Institutions Supervision of what to do whenever their rights Services Act No. 7 of 2017; Department.

36 September 2018 Zambanker THE FLETCHER LEADERSHIP PROGRAM FOR FINANCIAL INCLUSION

Preamble by KABINDA KAWESHA

One evening in November 2014 – on the closing date for applications for the 2015 Fletcher Leadership Program for Financial Inclusion (FLPFI) - I finally mustered the courage to submit an application for the programme. Perhaps courage is an understatement...I was actually motivated by the fear that I would not have a plausible answer to the question why I did not apply for the programme!

as a strategic priority at the time. My for Financial Inclusion application was successful and I was accepted as a fellow into the FLPFI Since 2011, the Fletcher School, 2015 Cohort. with support from the Bill and Melinda Gates Foundation (BMGF), From 2015 to date, the application of MasterCard Foundation and knowledge and skills acquired from Financial Sector Deepening Africa, the FLPFI – including the initiatives to has worked to strengthen the skills implement the FLPFI Policy Memos, of policymakers to design, implement Kabinda Kawesha and regular engagement with the and measure sound and innovative FLPFI Alumni (via social media, financial inclusion policies by using a meetings) to share policy/technical blended learning model that focuses or more than a year, I had updates or interact socially - has on the twin factors of leadership: been urged to apply for the been professionally enriching. One competence and confidence. program by two FLPFI alumni particular highlight in May 2018, was and counterparts from the an invitation from the FLPFI to return The Fletcher Leadership Program FAlliance for Financial Inclusion (AFI) to the residency session at Tufts for Financial Inclusion (FLPFI) is Mobile Financial Services Working University and participate as a judge an intensive nine-month executive Group, namely Mr Stephen Mwaura for the Pitch Day session of the 2018 certificate program designed to help Nduati (FLPFI 2011), former Head FLPFI Cohort. Therefore, from where individual policymakers increase of the National Payments System I sat as a judge, I could definitely the likelihood that their financial at the Central Bank of Kenya and relate with the Fellows in the ‘hot seat’ inclusion policy initiatives will be Mrs Elly Ohene-Adu (FLPFI 2013), of the 4-minute policy pitch! well-designed and implemented. It is former Head of Banking Services and actively promoted in the AFI network, Payment Systems Oversight, Bank of This article provides highlights of the and combines online and in-person Ghana. So with their encouragement programme. learning to engage policymakers in and support from Dr Tukiya an ongoing process of critical inquiry Kankasa-Mabula, Deputy Governor OBJECTIVES AND STRUCTURE informed by reliable evidence. It – Administration, Bank of Zambia, I OF THE FLETCHER LEADERSHIP challenges the policymakers to applied for the program. The topic of PROGRAM ON FINANCIAL identify and test assumptions that my application was on mainstreaming INCLUSION they may unconsciously hold dear. gender in financial inclusion as access to finance for women was emerging By The Fletcher Leadership Program The Eight-Question Method for

Zambanker September 2018 37 The 2018 FLPFI Cohort at the USA residency session with BoZ representatives - kneeling in the centre is K. Kawesha with Kim Wilson (Senior Technical Muuka Madubeko (FLPFI 2018) and standing third from the right is Kabinda Kawesha (FLPFI 2018 Pitch Day Advisor) and Mr. Mihir Mankad (FLPFI Judge and FLPFI 2015 Alumni) Communications Lecturer), May 2018

Policy Development (8QM) experts and professors. An Alumni Since 2011, the Fletcher from a previous Cohort is also invited At the heart of the FLPFI curriculum to the residency to mentor and share is the Eight Question Method School, with support their experiences in implementing for Policy Development (8QM). from the Bill and Melinda their Policy Memos. This is an adaptive framework that guides policymakers Gates Foundation (BMGF), The residency culminates in the through critical steps related to MasterCard Foundation and delivery of a Policy Pitch to a panel problem identification, solutions of external experts, outlining the development, policy formulation Financial Sector Deepening financial inclusion problem, the and selection, stakeholder Africa, has worked to policy solution and the ways forward. analysis, negotiation, persuasion, After the residency, fellows write implementation, and monitoring strengthen the skills of a draft Policy Memo that captures and evaluation. policymakers to design, their insights into the drivers of the financial inclusion problem, relevant The FLPFI therefore begins with implement and measure evidence, stakeholder interests, and an online course that introduces sound and innovative financial policy solutions. the 8QM and guides the fellows through a process of gathering inclusion policies by using a To earn a certificate, fellows must primary and secondary data blended learning model that complete original market research related to their financial inclusion with potential clients and potential challenge. During the online focuses on the twin factors of financial service providers, produce course, fellows are asked to leadership: competence and outputs related to the 8QM, and write interview potential clients and a final Policy Memo. The closing financial service providers. These confidence. session and graduation for the FLPFI exercises produce novel insights Cohort takes place at the annual and foster powerful moments The work completed during the Global Policy Forum of the Alliance of human connection. These are online course flows directly into the for Financial Inclusion. This also some of the ways in which FLPFI intensive two-week residency at Tufts provides an opportunity for past and continuously works to focus University in Boston, USA, during present fellows to convene to review the fellows on the real people – which fellows workshop their policy their progress in implementing new specifically the poor – that their ideas and participate in interactive policy initiatives and collaborate with policies seek to positively impact. classes with financial inclusion peers.

38 September 2018 Zambanker To date, over 50 policies that were in Financial Inclusion Strategy the signature “8QM” methodology developed during the program have to reach more policymakers at been implemented in full or in part by FLPFI 2015: Ms Kabinda Kawesha, FLPFI alumni institutions and Manager – Financial Sector collaborating institutions; and FLPFI Alumni. Development further strengthen the skills of alumni and their teams to advance “The FLPFI program is a valuable (b) Addressing the Problem of effective and measurable policies. capacity building program for policy Contracting Unaffordable Loans in To this end, FLPFI is launching makers and officials working to Zambia a series of incentives including: expand access to financial services global Alumni meet-ups, online for the unbanked and underbanked FLPFI 2016: Mr Joseph Munyoro, courses, scholarships, research segments of the populations. I Assistant Director Examinations & prizes and in-country workshops. personally enjoyed the lessons and the Surveillance, Non-Bank Financial learning process. The course helps one Institutions Supervision GUIDELINES FOR to critically appraise a policy initiative APPLICATIONS and ask the right questions” - Mr (c) The Financing Challenges of SMEs Muuka Madubeko (FLPFI 2018), Bank in Zambia and Possible Interventions FLPFI is currently accepting of Zambia. for the Bank of Zambia applications for the 2019 Fellowship. Applications should be complete, STATISTICS OF THE PROGRAM FLPFI 2016: Ms Mankolo Beyani, concise and comprehensive, from Assistant Director – Regulatory policy makers currently working „„ Number. of policy makers that Policy, Licensing and Liquidations, in financial inclusion policies have participated in the FLPFI : Bank Supervision within their institution. Some tips for applicants are: 109 policy makers representing 45 (d) Getting Money Transfer Services countries Closer to the Rural Zambian Start the application process early.

„„ Types of institutions/sectors FLPFI 2017: Ms Mirriam Kamuhuza, Compose your application first in represented in the FLPFI: Assistant Director, Payment Systems Word so you can check for spelling in Banking, Currency & Payment mistakes and go over it as often Public institutions with policy making Systems as you need. Have someone read responsibilities and working in the over your application to check for field of financial inclusion policy. (e) Promoting the Use of Mobile consistencies. Money Products to Increase Access Central banks; supervisory authorities to Formal Financial Services in Rural Start your internal processes, such from the banking, insurance, pensions, Zambia as acquiring the letter of support and securities markets; Ministries which aside from being a reference of Finance; financial inclusion FLPFI 2018: Mr Muuka Madubeko, letter from your superior, should secretariats; telecommunications Manager – Payment Systems include confirmation from your regulators; and SACCOs supervisory Oversight in Banking, Currency & supervisor that: authorities Payment Systems „„ If admitted, you will be granted „„ Thematic areas of the Policy THE ANNUAL FLPFI EVALUATION the necessary leave to attend Memos: the Fletcher residency The FLPFI is constantly trying SME finance, formal finance, rural to improve its programmatic in May 2019; finance, consumer protection, digital experience, and as such strives to financial services, agent banking, remain in touch with our alumni to „„ That you will be able to attend financial access, infrastructure, hear about their accomplishments the graduation ceremony in women’s access to financial services, since graduating from the FLPFI! fall 2019, with expenses borne savings groups, financial inclusion In the annual survey, FLPFI hopes by your institution and for youth and underserved groups, to monitor and hear about the payment systems. progress of the alumni policy „„ That the financial inclusion recommendations, how they are challenge you have identified All Policy Memos are on the FLPFI using the FLPFI skills, and what constitutes a priority for your website at: https://sites.tufts.edu/flpfi kinds of alumni activities they would institution. and provide information about what like us to provide. financial inclusion policies are being Make several attempts to do the done in other countries. POST-GRADUATE COURSES FOR program ALUMNI „„ Bank of Zambia FLPFI Alumni THE 2019 FELLOWSHIP MNI (Policy Memo, Year, Name) By engaging more proactively with our alumni, FLPFI believes The application period for the (a) Integrating Gender Mainstreaming that it can expand the reach of 2019 Fellowship is now open.

Zambanker September 2018 39 Former Minister of Community Development Ms Emerine Kabanshi who was Acting Minister of Finance and Guest of Honour robing Dr Tukiya – Kankasa Mabula as Chancellor of the ZCAS University.

Story continues from page 8 Earlier, the Deputy Governor achieve only half of our productive explained that current global value as the human race. To get to WELL DONE! statistics indicate that the population 100 percent of what God intended, of the world comprises 51 percent we need to empower both men and men and 49 to 49.5 percent women. women. We must work together to “Mahatma Ghandi once said, ‘be the Within the margins of empirical create the much needed common change that you want to see’. We statistical error, it can confidently value for our common destiny in are living in a time when there is an be approximated that the male life. And since women and girls are unwritten rule that suggests that if to female ratio is one to one. In marginalized in most cases, we need you want to change anything, you spite of this fact and for many to play catch up, double our efforts need many people to rally behind years, the males have been given and work towards harnessing your idea. This may be true in some more opportunities for growth the inert and untapped potential cases but not entirely true at all academically, professionally and that our creator intended for us to times. If that were the case, most in many matters of commerce. The achieve. Ultimately, as Christine of the innovations we have today women on the other hand have been Lagarde has put it, and indeed based would not have been mooted. In largely left behind, marginalized on much research and experience, fact, most of the breakthroughs that and their plight given little to no ‘Empowering women can be an we boast of in the fields of science attention. economic game changer’ for our and technology as well as in business country. that is why this conference, were scorned at by scoffers of the She said humans live in a patriarchal which empowers our young women, time. This is partly because change world that presents many obstacles is so crucial for our time,” she said. is not about populist ideals and in the path to the achievement of ideas. change is about vision and full potential for women and girls, Kupes Young Women’s Network conviction. It starts with one person; whereby issues of equity and gender was birthed from the Community one person who is willing to make discrimination in many forms and Library Development Network in the change and to confront common places are grappled with. She said Kabanana Township in Lusaka. stereotypes; one person who is these barriers continue to short- The Library catered for both girls willing to be different; one person circuit even well intended plans to and boys but there was a need for who is ready to be a game changer; empower women. girls to have a space or grouping one person that dares to dream big; where they could feel safe to share, one person who is relentless to find “But think about this: what happens if interact, be guided and mentored, new alternatives; one person who is we continue to empower one gender hence the network. It is an initiative willing to build upon best practice at the expense of the other? it means that is looking to grow in many and set the trend for the next that we are only able to perform communities in Lusaka and move to practice,” she challenged. at 50 percent of our capacity and other parts of the country.

40 September 2018 Zambanker EMPLOYEES UNDERGO FIRST AID AND CARDIO PULMONARY RESUSCITATION (CPR) TRAINING

By MERCY WASOMWE

First Aid is emergency treatment the situation worse not a matter of “if”, but “when” the administered to a victim of an accident situation will occur. Therefore, First or sudden illness before or until 4. Ensure the comfort of the ill or Aid training for employees is essential professional medical care is available. injured person for workplace safety.

First Aid is provided to: 5. Give psychosocial First Aid - make It is against this background that in the injured person feel better the Month of August 2018, a total of „„ preserve life by listening to them, talking Thirteen (13) employees drawn from „„ prevent the condition from quietly, touching them gently, and various departments in the Bank, worsening explaining to them what you are underwent a two day First Aid and „„ promote recovery doing. CPR training. „„ in some cases, it could mean the difference between life and death. 6. Emotional reaction might occur to This was the first group to be trained you afterwards - and it is expected that thereafter, SIX GENERAL PRINCIPLES OF FIRST other trainings will follow for other AID talk to family, friends, counsellors employees until the Bank has an entire or religious leader for your own workforce that is trained in First Aid. When administering First Aid, you emotional wellbeing have to take these Six (6) principles The more people that are First Aid into consideration as a first aider: FIRST AID AT THE WORK PLACE trained and knowledgeable,

1. Keep calm during an emergency is an important aspect of Occupational the more the community as a whole situation Health and Safety benefits.

2. Avoid infection to others and regardless of size or nature of the yourself workplace The Author is an Assistant Manager - Employee Wellness at 3. Act as a first aider by making sure Every organization has employees the BoZ Clinic. you take charge and do not make who will benefit from First Aid. It is

Assistant Manager - Employee Wellness Ms Mercy Wasomwe with Participants practicing transporting a victim using a stretcher while participants who took part in the first aid training Assistant Manager - Employee Wellness Ms Mercy Wasomwe looks on

Zambanker September 2018 41 NEW FACES

By ZAMBANKER REPORTER

The Bank of Zambia has recruited (ACCA) Procurement two members of staff in the third qualification. and quarter of 2018. Before joining Maintenance the Bank, Department. Departments that benefited from Mr Banda Mr Makwaza the recruitment are Internal Audit worked as holds a Grade and Procurement, and Maintenance a Principal 12 certificate Services at Regional Office. Auditor – IT and is Audits at studying Mr Marvin Banda joined the Bank on the Office of Banking and 16th July, 2018 as an Internal Auditor the Auditor Finance at in the Internal Audit Department. General where he worked in the Zambia College of Pensions and He holds an MBA in Finance and Compliance/Regularity and IT Insurance Trust. He is a member has Accountancy Degree from Audits. of the Zambia Institute of Banking the Copperbelt University. Mr and Financial Services (ZIBFS). Banda is also a Certified Chartered Mr Andrew Makwaza joined the Before joining the Bank, he worked Accountant having an Association Regional Office team on 1st August, for Voscha Investments Limited as of Certified Chartered Accountant 2018 as an Office Assistant in the a senior Marketing Officer.

Continues from page 23 SUSTAINABLE ECONOMIC EMPOWERMENT and maize grain. It however reduced securities, and rising non-performing of the economy; to 7.4% in June 2018 as inflationary loans which continue to favour „„ reduce the stock of arrears and pressures began to ease. lending to Government by the curtail the accumulation of new banking sector, thereby constraining arrears; and In the last one year, the Bank of private sector credit growth. „„ Slow down the contraction of new Zambia pursued accommodative debt to ensure debt sustainability. monetary policy by successively In 2018, Government’s major cutting the Bank of Zambia Policy Rate macroeconomic objectives are to: The Bank of Zambia is committed to to 9.75% in February 2018 from 15.5% delivering stability in prices thereby in February 2017 and maintained it at „„ achieve real GDP growth of at contributing to the reduction in this level in May 2018. The statutory least 5.0 percent; the cost of doing business. This reserve ratio (SRR) was also lowered „„ maintain single digit inflation in will create an environment that to 5.0% in February 2018 from 18.0% the range of 6.0 to 8.0 percent; will foster sustainable economic in February 2017. The accommodative „„ maintain international reserves empowerment. In addition, the monetary policy contributed to of at least 3 months of import Bank will continue to collaborate improved market liquidity conditions cover; with stakeholders with the view to and helped to lower commercial „„ attain domestic revenue strengthening the resilience of the banks’ lending rates, which reduced by mobilisation of at least 17.7 financial sector to domestic and about 5.4 percentage points to 24.1% percent of GDP; external shocks. in June 2018 from 29.5% in December „„ limit the fiscal deficit, on a cash 2016. Excluding outliers, the average basis, to 6.1 percent of GDP; Further, the Bank of Zambia nominal lending rates declined to an „„ limit domestic financing to no conducted a quiz at its pavilion, to average of 21.7% in June 2018. High more than 4.0 percent of GDP; measure the level of knowledge lending rates are partly attributed to „„ accelerate implementation of members of the public have on the elevated yield rates on Government measures towards diversification operations of the Bank of Zambia.

42 September 2018 Zambanker SEPARATIONS

By ZAMBANKER REPORTER Nine (9) members of staff have Roseline Anna Scott separated from Mr Shubert separated from the Bank through the Bank following the expiration of Sinyinza Voluntary Early Separation Scheme her contract on 14th July, 2018 after separated from (VESS), expiration of contract, medical working for 5 the Bank through grounds and resignation in the third years. She was VESS on 31st quarter of 2018. Director - Human July 2018 after Resources working for 22 Two of the nine former employees who Department at years. He was separated from the Bank were from the time of her an Examiner Security Division, two from Human separation. She - Building Societies & State Owned Resources Department while the other joined the Bank Enterprises in the Non-Bank Financial two were from Non-Bank Financial on 15th July, 2013. Institutions Supervision Department Institutions Supervision Departments. at the time of his separation. He joined Bank Supervision, Regional Office, Mr Victor Kalala resigned from the the Bank on 8th October, 1996. Procurement, and Maintenance Bank on 31st July, 2018 after working Services (PMS) Departments lost one for slightly over 20 years. He was an Mrs Elizabeth member of staff each. Assistant Manager – Human Resources Kapila Zulu Operations at separated from Those who left from Security Division the time of his the Bank on are Mr Christopher Silondwa and Mr separation. He medical grounds Saansa Musanje. Mr Saansa Musanje joined the Bank on 31st August, worked in the Security Division as on 16th February, 2018 after a Security Officer at the time of his 1998. working for 16 separation. He separated from the years. She was Bank through VESS on 31st July 2018 Mr Lazarous a Senior Analyst – Liquidations in after working for 19 years. He joined Siluonde the Non-Bank Financial Institutions the Bank on 8th December, 1999. separated from Supervision Department at the time of the Bank through her separation. She joined the Bank Mr Christopher VESS on 6th July, 2018 after working for on 2nd December, 2002. Silondwa also 19 years. He was an Assistant Manager separated from – Office Services in the Procurement Mr Kelvin M the Bank through and Maintenance Services Department Kapota separated VESS on 30th at the time of his from the Bank September, 2018 separation. He through VESS on after working for joined the Bank 31st August, 2018 slightly over 15 on 6th December, after working years. He was a 1999. for 29 years. He Technical Officer at Regional Office at was a Section the time of his separation. He joined Mrs Family Officer – Currency the Bank on 3rd April, 2003. Mulomba Libinga Accounts at Regional Office at the time separated from of his separation. He joined the Bank The Human the Bank through on 20th September, 1989. Resources VESS on 12th Department lost July, 2018 after working for slightly two employees in over 19 years. She was an Examiner - the names of Ms Examination and Surveillance in the Roseline Anna Bank Supervision Department at the Scott and Mr time of her separation. She joined the Victor Kalala. Ms Bank on 13th December, 1999.

Zambanker September 2018 43 PHYSICAL EXERCISES MUST BE A HABIT

By ZAMBANKER REPORTER

The Bank of Zambia Deputy Governor – Operations Dr Bwalya Ng’andu has advised financial sector employees to make exercise and physical fitness a habit by exercising regularly.

r Ng’andu, who was National Savings and Credit Bank also done to give interested members speaking after he attended (NATSAVE) staff were also in of staff an opportunity to exercise an-hour-long joint attendance and took part in the especially that most of them found aerobics session with fitness hour. it difficult to go to their training DBarclays Bank Zambia Plc in the facilities due to a number of factors. Bank of Zambia car park in Lusaka The fitness programme was initiated said, exercising should not be a one by the Central Bank’s Security ‘Other financial institutions have off activity because the body retreats Division as a way of encouraging shown interest in this programme. to its earlier state. healthy living and team spirit among So far we have held joint training employees. From time to time, the sessions with Barclays bank and The turn-out of the financial sector Bank invites employees from other Natsave. We envisage to hold joint employees amazed Dr Ng’andu as financial sector institutions to take training sessions once every month the car park was filled by the time he was joining them for the vigorous exercise session.

‘It’s great that so many of you turned up, fitness must be a habit, it’s not something that you do in one day because the effort you are putting in can be extinguished within a day, so let’s make this a habit, I think we can do more and more of this. Barclays you are welcome. There are a lot of you young ones and I noticed that some of you were struggling under your weight, make exercising a habit,’ the BoZ Deputy Chief advised. Deputy Governor - Operations Dr Bwalya Ng’andu and Barclays Bank Managing Director Ms Mizinga Melu Meanwhile, Barclays Bank Chief exercising with the Defined Style, Health and Fitness trainer Makungo Muyembe in the BoZ car park. Executive Officer Ms Mizinga Melu who led the Barclays staff in the aerobics session further advised part in the programme. to promote networking and healthy the bankers to keep exercising and living. checking their diet. Ms Melu thanked In an interview with the Zambankers, the Bank of Zambia for extending Assistant Manager - Compliance in The benefits of this program cannot an invitation to her bank for the Security Division Ms Gloria Chongo be over emphasized. Medical physical fitness programme. She said said physical fitness for security research has established that she exercises often to keep fit and personnel is one of its core activities physical exercises together with a advised others to do the same. and the Division has been carrying healthy diet prolong life and prevent out physical fitness programmes at ailments such as headache, flu, high ‘I exercise about 5 times a week, the BoZ Social Club. To make the blood pressure and heart attack. some of you are half my age, so you programme more exciting and for have to exercise and keep fit even if other members of staff to benefit Ms Chongo encouraged members it is just skipping in the house and from it, the Division resolved to of staff to take advantage of this eating well. I really want to thank extend it to the entire BoZ community program and reduce on the number the central bank for inviting us to by bringing it closer to employees of times they visit health facilities this place. We need to do this more by holding it in the car park after for ailments that can be avoided, often, I think it was great. Thank you working hours. The physical fitness saying this ultimately leads to a so much to the coach, I think that was sessions are held every Tuesdays and reduction in the Bank‘s medical amazing,’ Ms Melu added. Thursdays. Ms Chongo said this was bills.

44 September 2018 Zambanker 4TH BANKERS ANNUAL SPORTS TOURNAMENT KICKS OFF

By ZAMBANKER REPORTER

The 4th Annual Bankers Sports Tournament hosted by the Bank of Zambia kicked off at the BoZ Social Club on 22nd September, 2018 where 13 banks participated.

he BoZ Social Club Secretary tournament is going to run for a month Mr Chingeni Ndhlovu and at the end of it all, teams that will invited leaders of various Ms Musukuma expressed gratitude excel will be awarded trophies. While sports disciplines in the to the organising committee for this will be a motivation for teams TBank to mobilise staff and assemble to come out tops, let us not forget formidable teams to participate in this putting up this event and wished that we are a family and our conduct tournament. The various disciplines all participants a friendly, pleasant should not destroy the reputation of involved were football, netball, our respective institutions as well as volleyball, pool, chess, lawn and table and healthy sporting programme our relationships with one another. tennis, scrabble, tug of war, draught before officially opening the event. I would like to receive a report at the and darts. end of this event that we have made more friends and not enemies,” she Speaking at the official opening of the Lusaka, Head of Human Resources said. tournament at the BoZ Social Club in and Investrust Bank Ms Paxinna Musukuma commended the Bank of Ms Musukuma expressed gratitude Zambia for being consistent in hosting to the organising committee for this annual event for the 4th year. putting up this event and wished all She said this was a special day for participants a friendly, pleasant and all employees in the banking sector healthy sporting programme before as they were meeting as a family to officially opening the event. interact, share ideas and also build each other in terms of healthy lifestyle. The Banks that took part in the event included Access Bank, Atlasmara, Bank “Today, people who usually see us of China, Cavmont Bank, Barclays behind the counters in suits and ties Bank, United Bank for Africa and will see us differently in that they Citibank. Others were First Alliance will see us having a social life that is Bank, First National Bank, Indo also focused on keeping healthy and Zambia Bank, Investrust Bank, Stanbic fit through sports. I am told that this Bank and Standard Chartered Bank.

Ms Paxinna Musukuma

Zambanker September 2018 45 46 September 2018 Zambanker Zambanker September 2018 47 48 September 2018 Zambanker