By Wanangwa Tembo

Kasungu, August 19, Mana: It is month end and salaries are in. Like many others, Jimmy Yosofati, a primary school teacher residing in the populous Chitete Township of Kasungu Municipality rushes to the bank to make withdrawals.

The banking hall is full and there is an equally long and snaking queue at the auto-teller machine (ATM). Yosophati joins the queue on which he stands for about an hour before his turn comes.

As he cashes out a bundle of MK5000 notes, he knows he has to spend another good time on another queue, now to pay water bills at the nearby water board payment point domiciled at the Malawi Post Office building.

“In Malawi, you have to queue for everything.  You have to queue to deposit money. You have to queue to get the same.

“At the bank, at the filling station, at water board and everywhere you have to stand long hours on the queue,” he laments as he wipes some beads of sweat off his face.

Yosophati has a long day because after paying water bills, he has to join another queue to purchase electricity units.

The circus will repeat the other month.

Malawi is one of the countries where there is low adoption of digital financial services with the majority stuck with the traditional cash payment system which the Reserve Bank of Malawi (RBM) says is not only costly but also that it drains the scarce forex.

For example, RBM spent over MK23 billion last year to reprint damaged currency notes, according to Deputy Governor Macdonald Mafuta Mwale.

“These printers and suppliers are paid in dollars which means the country is losing a lot of forex just to replace damaged notes.

“If more Malawians adopt digital financial services, our projections show this figure will go down as there will be no demand to print more notes,” Mwale said.

He was speaking in Kasungu during the launch of a national awareness campaign on using digital financial services.

The campaign, which seeks to achieve a cashless economy where individuals can make financial transactions without using cash for an extended period, is being implemented by the Ministry of Finance through the RBM with financial support from the African Development Bank.

Funded to the tune of $14.3 million, the campaign which started in July will cover all the country’s 28 districts to scale up use of digital payment methods amongst communities.

“The world is going digital; why should Malawi be left behind? It is important now that we should encourage the population to go digital.

“One is for safety, efficiency and effectiveness when it comes to transferring of money, payments of bills and payments for any other goods or services.

“If we use more of the digital methods, then our demand to produce the actual Kwacha will go down and the bill to produce will also go down and we save the already scarce forex,” Mwale said.

He said it is high time Malawians adopted the modern ways of transacting which are convenient, reliable and secure.

“Keeping money in houses is not safe. Consider incidences of fire, for example. With digital platforms, safety is guaranteed and transacting is also simplified as you can pay while in the comfort of your house and the supplier with bring the goods for you,” he said.

Adding: “As we go digital, there are some people trying hard to manipulate the system so that they scam others. So there are those risks and we have to teach people on how they can be protected from such scams.

“There are also issues of unreliable networks. These are the issues we need to address as we run the campaign. People adopting digital methods should have minimal encounters with such challenges.”

Mwale said government will work hand in hand with the service providers to improve network signals to ensure that there are reduced challenges that discourage people from adopting these technologies, which include phones, internet, ATMs, banks, points of sale and digital village banking, among others.

The campaign has identified women, persons with disabilities, youths, small to medium enterprises, internally displaced people, the illiterate and the rural population as the targeted marginalised audiences.

“We want to get to every corner of the country raising awareness about the opportunities available in the digital financial services.

“For example, people think we need to withdraw cash on ATMs or Mpamba and Airtel Money agents and go somewhere to pay bills yet you can do that without necessarily withdrawing the money,” said Joshua Kunkumbira, the campaign lead person for Kasungu and Dowa.

He added: “Rural communities, including those in village banks and recipients of social cash transfers, need to be educated on the benefits of digital financial services, such as using Airtel Money, Mpamba, and bank accounts for transactions.

“Village banks must go digital. The youths that are engaged in businesses must be encouraged to transact digitally and not forgetting persons with disabilities whom we must identify and ask them about the challenges they encounter so that they are addressed.”

Kunkumbira also said the campaign will tackle issues of fraud and phishing schemes, over indebtedness, social engineering scams, data and identity theft and emerging innovations so that digital service users are protected from evil schemes.

“So in specific terms, we want to create awareness of digital financial services among the general public in order to increase usage and adoption.

“We also want to reinforce consumers trust in digital finance services opportunities and help local populations to better deal with the associated challenges, and also change perceptions and build awareness of risks, available consumer guidelines, costs and benefits in order to gain acceptance and utilisation among users.”

African Development Bank representative, Albert Mafusile said the Pan-African development and financial institution believes that digital financial services are safe, efficient and cost-effective.

“It is our hope that through the use of digital financial services, the Malawian public will enjoy the safety associated with the transactions which give you freedom to do anywhere as long as you have network.

“It is in our interest to see that these services are provided efficiently to those that use them,” Mafusile said.

He said while access to digital financial services in the country is growing, the services have not yet reached everyone hence the need for awareness raising activities.

“This campaign gives the opportunity to financial services to showcase what they offer and as the public get educated, it will be easier for them to start using them.

“For us, we want an inclusive financial services sector that does not leave anybody behind. And it is our hope that the partnership that African Development Bank has with Malawi will continue to grow,” he said.

Lack of information, fear of fraud and poor network feature highly as factors discouraging people like Yosophati to adopt and use digital financial services in the country.

As of March 2024, fraud on mobile money had decreased by 53 percent from MK28 million to MK13 million and 15 percent from MK2.7 million to MK2.3 million on Airtel Money and TNM Mpamba, respectively.

Parliamentary Committee on Media, Information and Communication described the decrease as a positive step towards promoting digital financial services.