ACCESSBANK Tanzania has introduced to the market a new savings account specifically tailored for Village Savings and Loan Associations (VSLAs) or most commonly known as informal savings groups.
The Bank’s Head of Business Development, Andrea Ottina, said the new savings account dubbed “KIKUNDI’ which is Kiswahili for group, is aimed at providing a platform for the informal savings groups to manage their funds ‘digitally’, which will help them to spare the
usage of cashboxes, which are often burdensome to handle and as well risky.
“This is the first product of its kind in Tanzania, provided with a three mobile banking profile system that ensure the highest level of safety as well as comfort to groups and their members to transact remotely.
Nonetheless, this platform will still enable the groups to continue their daily business without disrupting their social bond and behaviours,” he said. The project has been possible through a partnership with CARE International.
CARE is one of the worldwide leading NGO in establishing and training savings groups and assists them along their growth. AccessBank has also been supported by Selcom, its long-standing technology partner.
Specifically, a VSLA is a savings group which is generally comprised of 15 to 30 members and these members meet on a weekly basis for the purpose of buying shares, giving loans to each other and discuss other social issues including community welfare.
Mr Ottina said cash is kept inside metal cashboxes provided with three padlocks. A group usually has five governing persons selected internally, including the Chairman, two money counters, Secretary and Treasurer.
Three other members of the group are key holders to the cashbox which is opened once the weekly meeting has commenced. “Unfortunately, despite the security of the 3 keys system, the metal cashbox has not always proved to be a safe option; it is often stolen particularly at the end of the savings cycle where balances tend to reach their highest level.”
“As such, AccessBank has decided to provide a tool to these groups in order to substitute this cashbox with an account linked to mobile banking where every transaction is initiated from the Chairperson’s phone but requires the authorization of the two treasures, each from their own mobile phones.”
AccessBank Wakalas, the successful agent network of AccessBank, will be strategically located close to groups’ locations in order to cater for their cash-in and cash-out needs, he said. As cash-in will not require any authorization, cashout will still require the triparty’s authorization in order to be performed.
Finally, VSLAs using Access Bank’s three mobile banking profiles platform can benefit from Access Bank long standing commitment to free mobile banking transactions, and join the rest of the clients who are already using this service.”
Adding on this, the banks’ Marketing Manager, Mr Muganyizi Bisheko, said “Unfortunately, savings group have long been excluded by formal financial institutions including banks with often too expensive products or too stringent requirements in documentation”.
“The aim of this product is to cater exactly for them”. The uptake of this product has already been very exciting as more than 100 groups have already started banking with AccessBank Tanzania and many more are expected to join the bank in this journey.”
AccessBank Tanzania (ABT) is a socially responsible commercial bank with a special focus on micro and SME finance. The bank has strong international shareholders such as AccessHolding, International Finance Corporation (World Bank), KfW, African Development Bank and MicroVest.
Its vision is to be committed to the development of financial systems that support social progress by rendering services to all people with the same ambition for excellence, safety, and quality.
