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People’s Own Savings Bank Zimbabwe

People’s Own Savings Bank Zimbabwe
Admore Kandlela

​The People’s Own Savings Bank is the only savings bank in Zimbabwe and wholly-owned by the government of Zimbabwe. With 460,000 customers country-wide, POSB has the largest customer base of all Zimbabwe's banks.  Time for News & Views to talk to the bank's CEO. 

Can you introduce our readers to POSB by explaining its recent steps toward privatisation and its place in Zimbabwe’s financial system?

​The People’s Own Savings Bank is the only savings bank in Zimbabwe and wholly-owned by the government of Zimbabwe. The shareholder has taken a position to sell 49% of its shareholding in order to raise capital to fully capitalise the savings bank, and is currently scouting for the right partner. 

Among all of Zimbabwe’s banks, POSB has the largest customer base: 460,000 customers country-wide. This translates into a market share of about 20%. The bank has also the largest online branch network (214), comprising 34 own-branches and 180 agents nationwide.

​To what degree is POSB trying to harness technology to reach more customers and increase business? Are you tapping the power of mobile banking/mobile money?

POSB is cognisant of the convenience associated with technological advancement. To this end, POSB recently upgraded its core banking system in order to enhance transaction processing efficiency and to also enable the bank to develop customised products for its various market segments.

POSB was among the first banks to introduce mobile banking in Zimbabwe, in 2011. Currently, 26% of our active customers are on the mobile banking platform. We are currently mobilising and educating the majority of our customers to register for mobile banking in order to enjoy low costs as well as convenience associated with the service. This has brought banking so much closer to the customer, as even those customers in remote areas of the country are able to access and transact on their accounts 24/7. Transactions such as balance enquiry, internal transfers, domestic remittances, airtime purchase and bill payments, to mention a few, dominate the mobile banking service.

The bank is also working on modalities to widen its agency banking platform via point of sale (POS) devices so as to enhance financial inclusion. The bulk of transactions would therefore be channelled online.

The bank has also introduced internet banking. 

Does POSB have specific products targeting low-income persons?

As a mass market savings bank our products are tailor-made to meet the needs of the unbanked and low-income earners. The majority of our customers who are low-income earners include pensioners, civil servants, social welfare beneficiaries, vendors and security guards, to mention just a few.

Products for the low-income earners include:

  • Savings Products – our savings products have low minimum balances and customers can make monthly deposits from as low as US$5. We also offer high tax-free interest rates compared to the competition. Furthermore, all our savings products have no bank charges.
  • Pensioner’s Account – has no minimum balance or withdrawal charges and has a subsidised monthly ledger fee. However, pensioners aged 60 and above enjoy free banking.
  • Pensioner’s Loan – pensioners can access personal loans ranging from US$100 to a maximum of US$3,000. These loans are designed to enable pensioners to embark on income-generating activities such as communal farming. The loan attracts lower interest rates and has a maximum repayment period of 18 months.
  • Funeral Cash Plan – the Funeral Cash Plan offers a dignified burial through the provision of a cash benefit to the client at the time of bereavement, bringing a little comfort to the family. From as little as a US$0.80 monthly premium, the customer can receive US$500 at the time of bereavement.
  • ​Individual Account – this account targets low-income earners, both employed and unemployed. It has a low minimum balance and lower charges compared to other local banks.
  • Microfinance Loans – the bank recently established a Micro-Finance Unit, which targets individuals, groups, entrepreneurs and small businesses lacking access to banking and related services. These loans range from US$100 to US$5,000, have a maximum repayment period of six months and interest rates are also affordable. 

​Do remittances play any role in your business model?

Yes, remittances play an important role in our business model. As you may be aware, we are an agent for Western Union for inbound and domestic money transfers. Through our mobile banking platform, we also offer mobile money transfers. Remittances comprise about 5% of our monthly total income. We feel there is great potential in the remittances business. To this end, efforts are underway to promote the use of our mobile money transfers. 

What would you like to gain – and contribute – via your membership in WSBI? Do you see potential for cooperation?

I believe being a member of WSBI presents a unique opportunity to be part of an international network of like-minded institutions developing similar activities and facing comparable challenges, to be represented at the regional and international level and receive information and intelligence about regional and global financial matters, and possibly to benefit from training and/or consultancy services offered by WSBI. POSB is also sharing information on our successes and experiences with other members.


​www.posb.co.zw​​​

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