THE Bank of Zambia (BoZ) will increase usage of formal financial services to 70 percent by next year through implementation of various strategies in an effort to secure funds.

The Central Bank is working on more strategies which will assist to migrate users of formal financial services to 70 percent by 2022 from the current 38 percent due to risks associated with the informal setup.

This is according to the BoZ Financial Sector Development Manager, Kabinda Kawesha.

Ms Kawesha explained that the target of the National Financial Inclusion Strategy 2019-2022 was to lower the usage of informal financial services as they were not safe.

“Under the Financial Inclusion Strategy, we are trying to see how we can migrate people who are only relying on the informal finance to bring them into the financial sector and ensure that they are not only using their savings groups or village banking but they are also using more diverse financial services.

“This is because of the risks associated with the informal financial services,” she said during a presentation at the just ended media training on financial inclusion organised by the Financial Sector Deepening Zambia.

Ms Kawesha stressed that the financial sector remained the formal service providers in the banking industry.

She explained that using formal financial services had immense benefits such as safe storage of funds and reduced the risks of carrying cash or impulse buying.

Ms Kawesha indicated that they also enabled people to transact online for trade and other transactions.

“The goal of the Central Bank is to reduce informal financial inclusion. We already have strategies in place to drive people into formal finance.

“We recognise that these [informal financial services] are now community based which are managed by people who know each other, especially in the village banking group setup,” she said.

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