FINANCIAL inclusion, access to finical services and products can help alleviate poverty for the low-income and rural population in Lesotho through mobile money, the ministry of finance’s Private Sector Development Director, Maseeiso Lekholoane, has said.
Ms Lekholoane was speaking at the recent launch of the Hackathon: Innovation for Financial Inclusion Services in Maseru.
The hackathon is part of the Lesotho Scaling inclusion through Mobile Money (SIMM) project a collaborative initiative of the ministry of finance and the United Nations Development Programme (UNDP). It is aimed at catalysing inclusive and pro-poor growth by scaling up formal and semiformal financial services for low-income and rural population in Lesotho through mobile money and is also sponsored by FinMark Trust.
Ms Lekholoane said that the aim was to improve access to financial services especially to the low-income people of the country.
“We launch yet another initiative geared towards the improving access to financial services especially to the low-income segment of our society,” Ms Lekholoane said.
“The government is supportive of financial inclusion as a means to poverty alleviation and this has broadly been anchored on the currently extended National Strategic Development Plan (NSDP) 2013 – 2017.
She said the inclusion of the financial sector in the NSDP had marked an important step in developing an overarching framework for financial sector development, now more specifically addressed in the Financial Sector Development Strategy (FSDS) which was adopted in 2013.
Ms Lekholoane said financial inclusion can play a catalytic and supportive role in industrialisation, a core SADC objective, helping to address important areas such as domestic resource mobilisation as indicated in the regional strategy.
“The regional strategy emphasises the growth of payments and digital financial services, orienting credit markets towards small and medium-sized enterprises (SMEs), Ms Lekholoane said.
“A look at the take-up levels of financial services and products paints another interesting picture. Lesotho’s financial inclusion levels are comparatively high. Just picking on the banking penetration for instance, Lesotho has reached 41% in 2016.
“We are convinced that mobile money can be used as a channel to offer innovative and low-cost credit, savings and insurance products and significantly reduce the costs of transferring money compared to traditional forms of money transfer,” Ms Lekholoane said.
For her part, the UNDP Deputy Resident Representative, Christy Ahenkora, said innovation can facilitate economic growth and development.
“Innovation is regarded one of the cornerstones to economic growth and development. Technological innovations have a huge potential to help accelerate attainment of the Sustainable Development Goals (SDGs), to bridge the development divide between societies, and enhance industrial development,” Ms Ahenkora said.
She said the Lesotho SIMM is anchored on promoting use and adoption of technology, through mobile money, to develop inclusive and collaborative solutions to common challenges in the business environment and enhance financial inclusion.
“There is a huge divide in the access to finance in rural areas and urban areas in Lesotho, in favour of the urban areas and mobile money seemed to provide almost immediate solutions.
“We have realised that some of the challenges may not be easy to resolve and may require big investment. This is considered therefore a safe space, for ideation and building capacities for innovative thinking,” Ms Ahenkora said.