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Banks pay US$98,000 to financial switch project

BANKERS Association of Zambia (BAZ) says commercial banks are not in any way resisting the national financial switch (NFS) project and have since contributed US$ 98,000 each towards its implementation.
The NFS project is being undertaken by the Zambia Electronic Clearing House Limited (ZECHL), and is meant to interconnect all banks’ electronic payment channels thereby increasing financial inclusion and lowering transaction costs.
However, there has been a concern that some banks do not want the project to take off because it will make them (banks) lose millions in transaction fees which they currently collect through payment networks such as VISA, MasterCard and Zamlink.
But BAZ chief executive officer Leonard Mwanza said commercial banks are fully supportive of the NFS project.
He said banks made a joint decision with the Bank of Zambia to utilise funds which were raised by ZECHL over a period of time to go towards the NFS project.
“Other than funds raised by ZECHL, banks have made the second largest contribution towards the NFS so banks are not in any way resisting the NFS, project. They have individually contributed US$98, 000 towards the cost of the NFS. In total, banks have contributed US$1,862,000 in support of the project.”
“In addition, the ZECHL, the project implementer, is jointly owned by the Bank of Zambia and commercial banks with 50 per cent shareholding. Banks also sit on the project steering committee of the NFS project,” Mr Mwanza said in response to a press query.
He said the project kicked off last year and has reached an advanced stage, and details can be obtained from ZECHL, who are implementing the project.
“The implementation of the switch will require time because of the project management life cycle from scoping, testing to implementation. So far, a number of milestones have been achieved, and some of the modules should be up and running by October 31, 2016.”
“It is also worth noting that the national switch is not unique to Zambia alone as it has been successfully implemented in other countries as well. As the Bankers Association of Zambia, we will continue to support the Bank of Zambia in ensuring the success of this project,” Mr Mwanza said.