Financial inclusion ought to factor in impact

A recently released report indicates that 72 per cent of Rwandan adults, approximately 3.2 million, have or use financial products; with 57.5 per cent informally served which indicates that government efforts towards this critical aspect of the economy is bearing fruit.The report, by South Africa-based FinScope attributes the increase to new banks entering the market, increased outreach of existing banks and introduction of Savings and Credit Cooperatives (SACCOs) at the sector level and the establishment of Umurenge SACCOs.Over the last few years, Government has attached significant importance to the idea of financial inclusion. This essentially means ensuring access to appropriate financial products and services by all sections of the society especially the weaker ones and those with low-income.The argument behind promoting financial inclusion stems from the fact that in its absence, socio-economic developments cannot take place at its expected due pace. Yet, Finance Minister John Rwangombwa’s persistence on the impact of such financial services on people’s lives, let alone the high figures reflected in the report, cannot be gainsaid.If at all there are any imminent shortfalls in terms of the impact, there should then be a strong pitch for further financial education, which plays a significant role in the promotion of financial inclusion and inclusive growth, especially in rural areas. While the likes of Umurenge SACCOs and other financial players have played their role, it is doubtless a fact that without the people acquiring enough knowledge about financial inclusion and its benefits, it would not have the desired result in terms of being effective.Besides financial education of the populace, consumers of financial products also need to be made aware of their rights and obligations. Given the large number of stakeholders, including the National Bank of Rwanda, government, banks and financial institutions, a coordinated national effort rather than piecemeal approaches at different levels would be more valuable.By incorporating targeted financial education in the country to create the desired impact, this should go a long way in promoting bespoke financial inclusion amongst the excluded 28 percent of the population as well as bringing about improvement in the quality of the lives of the poor and the downtrodden and bring in progress for the nation as well.We hope that this is realised by all stakeholders responsible for making the process a success and that such strategies would be pursued in earnest.

Opinions

Financial inclusion ought to factor in impact