K OF AN Z B I M E B V A R B E W W S S E E E E R R ZIMBABWE NATIONAL FINANCIAL INCLUSION JOURNEY 2016-2020 ZIMBABWE NATIONAL FINANCIAL INCLUSION JOURNEY 2016-2020 Reserve Bank Of Zimbabwe Table of Contents Preliminaeliminary pages i-i-viii CHAPTER 1 BACKGROUND --1 1 - - Introduction --2 2 - - Benefits of Financial Inclusion --2 2 - - NNaational Financial Inclusion Strategy -- 5 - - PillaPillars Of The Nfis -- 5 - - Target Groups And Baseline Data -- 7 - - CHAPTER 2 IMPLEMENLEMENTTATION FRAMEWORK OF THE NFIS --1 14 - - Overview --1 15 - - NFIS Thematic Working Groups --1 15 - - Financial InInclusion EnaEnablers --1 17 - - Reserve Bank EmpEmpowerment Funds -- 27 - - CHAPTER 3: FINANCIAL INCLUSION INITIATIVES FOR TARGET GROUPS --2 29-- MICRO, SMALL AND MEDIUM ENTERPRISES -- 30 - - MSMEs Credit Guarantee Scheme -- 32 - - Incubation and Innovation Hubs -- 32 - - Micro Insurance Products -- 36 - - Capital MMaarkets InitInitiiatives -- 39 - - SMEs Operating Workspace -- 40 - - Capacity Building of the MSME sector by Various Stakeholders -- 44 - - Women Financial InInclusion -- 48 - - Women Financial InInclusion And Gender-Disaggregated Data… -- 64 - - Youth Financial Inclusion -- 70 - - Financial Services And Products For The Youth By Other Stakeholders… -- 75 - - Small Holder Farmers and Rural Communities Support -- 81 - - Financial InInclusion InitiInitiatives Targeting People With Disabilities (Pwds) -- 99 - - CHAPTER 4 : MICROFINANCE-AS A KEY FINANCIAL INCLUSION PILLAR -- 102- - The Microfinance ContContext in ZimbZimbabwe -- 105-- Capacity Building -- 105-- Credit Infrastructure -- 105-- Microfinance OutOutreach -- 105-- DTMFIs and Deposits Mobilisation… -- 105-- Projects supported by DTMFIs under the NNaational Financial InInclusion Strategy (NFIS) -- 105-- The Savings and Credit Cooperative Societies Subsector --105-- Microoffinance Active in The Community --10 105-- CHAPTER 5 FINANCIAL INCLUSION PILLARS --1 138- Introduction --10 105-- PILLAR 2 : FINANCIAL INNOVATION --1 141 - - Key Developments in DFS --1 141 - - Electronic Transactions --1 143-- FinTech Regulation in Zimbabwe --1 146-- Mobile Financial Services --149-1 - Remittances - -154-1 - Innovations in the Capital Markets --159-1 - PILLAR 3 : FINANCIAL LITERACY --169- Financial Literacy and Consumer Protection Thematic Working Group --170-1 - Financial Literacy Training - -171-1 - Global Money Week Celebrations --175-1 - Community Information Centres - -184-1 - PPILLAR 4 : CONSUMER PROTECTION --188- CHAPTER 6 : CHALLENGES EXPERIENCED IN IMPLEMENTING NFIS 1 --190- CHAPTER 7 : CONCLUSION AND RECOMMENDATIONS --195- Annexures - -198-1 - ZIMBABWE NATIONAL FINANCIAL INCLUSION JOURNEY 2016-2020 Reserve Bank Of Zimbabwe ListList of of Tables Tables CHAPTER 1 BACKGROUND -3- Table 1.1: SSttatus of Financial Inclusion in ZimZimbbabwe - 4 - Table 1.2: Level of Financial EExxclusion in 2011 - 4 - Table1.3: PillaPillarsrs ofof thethe NNationalational FFinancialinancial InInclusionclusion StStrraategytegy - 5 - CHAPTER 2 IMPLEMENTATION FRAMEWORK OF THE NATIONAL FINANCIAL INCLUSION STRATEGY - 14 Table 2.1: NFIS Thematic Working Groups - 15- - Table 2.2: NFIS Working Groups - Summary of key issues discussed - 116 Table 2.3: Ten SDGs Priorititiized by Zimbabwe - 119 - Table 2.4: ReseReserverve Bank EmEmpowermentpowerment FFacilitiesacilities - 227 - CHAPTER 3: FINANCIAL INCLUSION INITIATIVES FOR TARGET GROUPS .- 29 - Table 3.1: Financial Inclusion Indicators for MSMEs: 2016-2019 - 32 - Table:3.2: Cumulative MSMEs Guarantees availed by ECGC as at 31 December 2019 - 32 - Table 3.3: Innovation Hubs EstaEstablished by Stakeholders. - 33 - Table 3.4: Registered insurers and micro-insurance products and servicservicees. - 377 - Table 3.5: Other features of interest at Eastgate Market. - 3142 - Table 3.6: CaCapacity building efforts by various financial inclusion stakeholders - 3344 - Table 3.7: Product offering by the Zimbabwe Women Microfinance Bank. - 4258 - Table 3.8: Trend in the level of access to banking services by women. - 4865 - Table 3.9: Women Associations and Organisations-Zimbabwe . - 5168 - Table 3.10: EmpEmplloyment-to-Population Ratio, Zimbabwe 2019 LFCLS - 5471 - Table 3.11: DisDisttribution of EmpEmplloyed Youth Population, Zimbabwe 2019 - 54- 71 - Table 3.12: Occupation of the empemplloyed youth population - -54-71 - Table 3.13: EmpowerBank Product Uptake as at 31 March 2020, Zimbabwe - 5675 - Table 3.14: Projects Supported by EmpowerBank as at 31 March 2020, Zimbabwe - 5776 - Table 3.15: Institutions offering products targeting school going children and youth. - 5776 - Table 3.16:3.16 : F Loansinancial di sIbnucrlusionsed to Initthe iyatouthives by Financial Institutions and Other stakeholders - 6577 - Table 3.17: VFinancialalue Chain Inc lusionFinancing Initi Modelsatives b yb yF inancialFinancial Institutions Institutions and Other stakeholders - 7283 - Table 3.18: FVinancialalue Chain Inc lusionFinancing acti vitiesModels ta rbgyeted Financial at People Institutions with Dis abilities - 7695 - CHAPTERTable 3.19: F inancial4 MICR IOFInclusionNANCE-AS activities A ta KEYrgeted F aItN PANCIALeople with INCLUSION Disabilities PILLARS - 7899 - TaCHAPTERble 4.1: MSME 4 MIC guaROFIranteeNANCE-AS to suppo rAt MSMEsKEY FI NasANCIAL 30 June 2020INCLUSION PILLARS - 102-87- Taabblele 4.2:4.1: NumberMSME guaof Miranteecrof inanceto supp Institutions-ort MSMEs asZim 30b aJbunewe 20202016-2020 --87- 113 - Table 4.34.2: : NumberDeposit-taking of Mic rMiofinancecrofinance Institutions- Institutions Zim inba Zimbweb 2016-2020abwe as at 31 March 2020 - 90113 - - Table 4.44.3 : NumberDeposit-taking of SACCOs Micro andfinance SACCOs Institutions Membe inr sZim by bParbowvincee as at 31 March 2020 --118-99 - TCHAPTERable 4.4 : Number 5 FINANCIAL of SACCOs INCLUSION and SACCOs PILL MembeARSrs by Province - 106-129 - TCHAPTERable 5.1: P a5yment FINANCIAL systems aINCLUSIONrchitecture PILLARS -- 138-108 - Table 5.25.1: T Pransactionalayment systems Volumes architect andu Vrealues - 109-140- Table 5.35.2 ATrccessansactional Points V andolumes Devices and :V 2015-2019,alues Zimbabwe - 110-141- TableTable 5.35.4 A: ccessNational Points Fintech and DSteeringevices : Committee2015-2019, Zim babwe --143-111- Table 5.5:5.4 : Summary National Fintechof Mobile Steering Financial Committee Services Market --145-114- Table 5.65.5: Bureau Summary de changeof Mobile and Financial banks (and Services Money Market Transfer Agencies (MTAs)) --146-116- Table 5.7:5.6 Bureau MTA Branch de change Distribution and banks 31 (and December Money 2019,Transfer Zimbabwe Agencies (MTAs)) --152-117- Table 5.8:5.7: BureauxMTA Branch de Change Distribution Branch 31 Distribution December 2019,as at 31 Zimbabwe December 2019 --154-117- Table 5.95.8: : BureauxNumber deof Changeregistered Branch users Distributionon the C-Trade as atPlatform 31 December Number 2019 --154-120- Table 5.105.9 : :Number Financial of Literacyregistered Training users on and the Awareness C-Trade Platform Campaigns Number by Stakeholders --157-129- Table 5.115.10 Summary: Financial of Literacy 2019 GMW Training activities and Awareness by Stakeholders Campaigns by Stakeholders --169-133- Table 5.125.11 :Summary Other Financial of 2019 Literacy GMW activities Initiatives by by Stakeholders Stakeholders - -175-134- Table 5.13:5.12 : Distribution Other Financial of CICs Literacy as at Initiatives31 August by 2020 Stakeholders -176--139- Table 5.145.13: Distribution Distribution of of CVICs CICs as as at at 31 31 August August 2020 2020 --183-139- CHAPTERTable 5.14 Distribution 6 : CHALLENGES of CVICs EXPERIENCEDas at 31 August 2020 IN IMPLEMENTING NFIS 1 --184-143- TableCHAPTER 6.1 MAJOR 6 : CHALLENGES CHALLENGES EXPERIENCED FACED DURING IN IMPLEMENTING NFIS 1, 2016-2020, NFIS 1ZIMBABWE --190-144- Table 6.1 MAJOR CHALLENGES FACED DURING NFIS 1, 2016-2020, ZIMBABWE -191- CHAPTER 7 CONCLUSION AND RECOMMENDATIONS -195- ZIMBABWE NATIONAL FINANCIAL INCLUSION JOURNEY 2016-2020 Reserve Bank Of Zimbabwe List of Figures CHAPTER 1 BACKGROUND - 1 - Figure 1.1: Importance of Financial Inclusion -3 - Figure 1.2: NFIS Pillars & Core Enablers - 6 - Figure 1.3: Results of the 2012 Finscope MSMEs Survey - 7 - Figure 1.4 : Trends in Farm types 1980-2014 . -9- CHAPTER 2 IMPLEMENTATION FRAMEWORK OF THE NATIONAL FINANCIAL INCLUSION STRATEGY . - 11- Figure 2.1 : 17 SDGs - 14- Figure 2.2 : Key Stakeholders - 16- Figure 2.3: Alliance for Financial Inclusion Working Groups -16- Figure 2.4: Cumulative Credit Registry Inquiries: June 2017 – June 2020 - 19- Figure 2.5 : Credit Registry Inquiries by Banks and MFIs: 2017 – 2020 - 19- CHAPTER 3: FINANCIAL INCLUSION INITIATIVES FOR TARGET GROUPS - 21 - Figure 3.1 : Values of US$ traded on the SMEs Foreign Exchange Auction System, Zimbabwe - 35- Figure 3.2 : Key Milestones in Women Financial Inclusion - 37- Figure 3.3: Number of Loan Contracts by Gender, Zimbabwe 2019 -2020. - 48- Figure 3.4 : Number of Loan Contracts by Gender and Age, Zimbabwe 2019-2020. -49- Figure 3.5 : Percentage of New Loan Contracts by Gender. -49 - Figure 3.6: Challenges contributing to youth financial exclusion -55 - CHAPTER 4 MICROFINANCE-AS A KEY FINANCIAL INCLUSION PILLAR -78- Figure 4.1: Credit Registry -86- Figure 4.2: Trend in Number of MFIs & Branches, Zimbabwe : 2015-March 2020 -87- Figure 4.3: Number of Active Microfinance Clients, Zimbabwe:2015-2020 - 88- Figure 4.4: Number of Microfinance Loans . - 88- Figure 4.5: No. of Active Microfinance Clients & Percentage Female Borrowers. - 89- Figure 4.6 : Distribution of SACCOs Membership 2016: April