Cash dependence strangling economy – BAZ

Fri, 14 Apr 2017 11:06:46 +0000

BY MAILESI BANDA

HAVING a cash-driven economy as opposed to a cashless economy is what is affecting the growth of the banking sector in Zambia, Bankers Association of Zambia (BAZ) chairperson Charles Mudiwa has said.

Mr. Mudiwa suggested that Zambians should embrace a cash-free trading system that would allow them use cards to buy and sell and help the banking sector attain growth.

He said the performance of the banking sector was critical to the growth of the economy.

“We have so much cash with people in Zambia and this poses a challenge to the growth of the banking sector because of a cash-driven economy,” Mr Mudiwa.

He suggested that the money which is being exchanged in trade could be used to grow the economy by harnessing it into the banking sector.

He explained that economic growth was critical to the performance and growth of the financial sector and that the economy and banks played a crucial role in ensuring that the economy attained the required growth.

“The banks continue playing the role of enhancing economic growth while playing the intermediate role to enhance economic growth,’’ he said.

He said if the banking sector was impaired the economy would negatively be affected.

Mr Mudiwa said when the rate of growth in the sector was not looking healthy, banks would strive hard to ensure that there was economic growth.

He appealed to the Government to minimize the regulations imposed on the banking sector, adding that while this was beneficial to the running of the economy there was need to reduce the number of regulators.