MASERU — The Millennium Challenge Corporation (MCC) has injected about M6.9 million in the Lesotho Post Bank (LPB)’s ATM card based transactions project in an effort to strengthen the bank’s market depth.
The MCC and the LPB signed the agreement in which the bank undertook to be an agency for the ATM card based transactions to the population unexposed to automated banking last year.
The project will help increase the LPB’s customer base which grew from 14 600 at its inception in 2005 to 65 800 last year.
Speaking at a media briefing on the performance of the bank on Tuesday last week, the LPB’s Executive Director Mpho Vumbukani said the introduction of card based transactions would make things easy for young customers whose number is growing dramatically.
Vumbukani said the MCC fund’s objective is to help the bank to provide a reliable transaction platform aimed at enabling the un-banked and under-banked Basotho to transact in a secure manner.
“The Millennium Challenge Corporation has considered the Lesotho Post Bank as an agency for the development of debit smart card transactions,” Vumbukani said.
Vumbukani said the LPB would have ATM machines with exquisite technology that would be suitable for the illiterate, semi-literate, literate and aged customers throughout the country.
For those who could not operate the ATM using the common way of entering a pin code due to illiteracy or old age or other impediments, the LPB is planning to introduce a biometric system.
The biometric is a system in which an ATM card holder swipes a thumb at an appropriate button on the ATM machine which identifies his finger print.
This will be a useful system for the kind of customers the LPB has throughout the country.
The bulk of the bank’s customers are pensioners aged 70 and above, illiterate and semi-literate rural people most of whom are farmers whilst others are literate but are not acquainted with automatic banking due to living in rural areas.
However, the LPB will have to overcome the challenges of lack of telephone lines and electricity in the remote areas of the country.
LPB has 12 branches countrywide and half of them are still not automated.
In order for the project to be successful, Vumbukani said all branches need to be automated.
He said six more branches will soon be automated in partnership with telecommunication service providers.
“Applied technologies could be Wimax, GPRS and 3G,” he said.
“All new branches will be fully automated,” he said.
Vumbukani said the LPB aimed to be a sustainable financial service provider of choice in the retail market and champion of socio-economic development.
LPB uses post office buildings to provide banking services to Basotho.
The targeted customers are mainly from the rural areas where there is scarcity of banking services.
The research findings by the FinMark Trust reveal that Lesotho’s population with access to formal savings is only 19.7 percent whilst those with access to formal transaction are 6.7 percent.
The LPB was established in January 2005 after the privatisation of Lesotho Bank resulted in the closure of smaller bank offices leaving people living in the rural areas without banking services.
The government of Lesotho allocated M39.8 million to the Ministry of Communications, Science and Technology for the launch of the LPB.
Finance Minister Timothy Thahane told the National Assembly then that the bank’s service would “provide banking services in many rural areas left without services when the old Lesotho Bank closed.”