NAIROBI, Kenya, Mar 19 – The Central Bank of Kenya (CBK) is mulling new ways to spur a savings culture amongst women in Kenya.
CBK Governor Prof Njuguna Ndungu said on Friday that this was in an effort of tapping more into the wealth potential that exists in the rural areas. He said this would enable women to take up a more proactive role in growth of the economy.
“If you can not access markets then you can not trade your assets. Poverty is a as a result of lack of assets since you cannot accumulate capital,” Prof Ndungu said.
He said for a long time the problem for many women has been the numerous barriers to financial services that has seen them take a back sit.
“Banks have realised these challenges and have made efforts to do away with high ledger fees as well as lowering the minimum deposit,” he said.
According to the Governor there is a lot of income in the rural areas. He cited an example of two banks opened in Bondo and Garrisa and which in four months of opening they were reporting between Sh250 million and Sh600 million deposits.
Poor infrastructure has remained the greatest challenge towards deepening financial access in the rural areas. As such Prof Ndungu said they were fast tracking efforts to come up with agent banking guidelines to reduce the cost of financial services to financial institutions and individuals.
“What we want is for micro finance institutions to set up networks that go down into the rural area solving the perennial challenge of information asymmetry,” he said adding it was going to address the cost of doing business.
CBK is also in the process of developing a Deposit Protection Fund Bill to make the Deposit Protection Fund an independent institution from the central bank.
He was speaking during the opening of the African Women Economic Summit in Nairobi.
Also speaking during the summit was Graca Machel, Founder of the New Faces, New Voices Network who challenged banks to harness the entrepreneurship potential of women in an effort of bringing them into the formal economy.
“If you look at the formal economy very few women succeed to have access to finance and it’s in the interest of banks to tap into this,” Mrs Machel said.
Mrs Machel raised concern that many women were engaged in the informal sector which in her opinion contributed slightly to a county’s economy. She challenged women to make the transition from small scale enterprises to much larger ones.
African Development Bank president Dr Donald Kaberuka said that the bank was in the process of coming up new and innovative approaches for promoting economic equality and women’s full participation in the shaping of Africa’s economic future.