Development
Zambia: Zanaco to Enter Micro-Finance as Part of Digital Push, says CEO By David Whitehouse
Zambia National Commercial Bank (Zanaco www.zanaco.co.zm) plans to launch microfinance services including loans and savings for poor households in the fourth quarter, CEO Henk Mulder tells The Africa Report. The services are part of Zanaco’s digital strategy and will rely on digital credit-scoring and collection systems, says Mulde. The loans will be mainly to households, for amounts as small as $50 or $100. “You can do it e ciently if you can do it digitally,” he adds. Microfinance has too often concentrated on lending to the exclusion of saving, argues Mulder. “That’s the problem. Borrowing is not necessarily a good idea with high interest rates. It can bring people into trouble.” Microfinance borrowers from Zanaco will also be able to have a savings account, he said. “It’s not a one-product push.” Mulder is optimistic about prospects for Zambia’s economy. Discretionary spending globally has been hurt by COVID-19, but basic needs in Zambia are still being fulfilled. Copper, he notes, has rebounded to well above $6,000 per ton. Still, Zambia needs greater economic diversification away from copper mining and agriculture. “We need more industrialisation. We need more value-added,” he notes. There are not enough small new businesses starting in Zambia, says Mulder. But young entrepreneurs should not be borrowing straight away to get going. “You have to start small.” The government needs to educate and give incentives to entrepreneurs. “Starting a business doesn’t mean that you are going to make a profit right away,” something which the government
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Mukwandi Chibesakunda, CEO Zanaco Forbes
doesn’t always seem to understand, he says. “They could do better on that.”
Succession Zanaco, which listed in 2008, is Zambia’s biggest local bank. Its largest shareholder with a stake of 45% is the African investment company Arise, which is backed by Norfund, Rabobank, and Dutch development bank FMO. Mulde, who became CEO in 2016, will step down to be replaced by Mukwandi Chibesakunda, CEO of National Savings & Credit Bank of Zambia, or NATSAVE. Chibesakunda, the first female President of the Zambia Institute of Banking and Finance, joins Zanaco on 1 October. “It’s time for a Zambian CEO,” says Mulder, who plans to seek non-executive African roles. • The bank’s digital strategy means that IT security will need to be high on Chibesakunda’s agenda, says Mulder. “It’s a worry we all have
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