Editor's Comment

Protect village bankers

REPORTS of people being swindled of their money under the guise of village banking schemes are becoming common in the country.
These scams make sad reading because most of the people who join these village banking schemes are women with scarce financial resources to invest.
They sacrifice the little they have to invest it in village banking schemes with the hope of recouping the benefits of collective saving.
The concept of village banking is good but it is worrying that some unscrupulous people are deceiving unsuspecting members by taking pecuniary advantage of them.
The case in point is the revelation by the Bank of Zambia and the Drug Enforcement Commission (DEC) that Comsave Credit Union and ONO Savings Credit Association (OSCA) have been collecting and lending money from members of the public illegally under the guise of village banking.
A joint statement by BoZ and DEC notes that the scam had a semblance of Money Circulation Schemes which are prohibited under the banking and financial services act.
The statement, in part, reads: “We are doing our level best to ensure that interests of all stakeholders are protected, while the due process of the law takes its full course. We, therefore, appeal to members of the public to remain calm as investigations are still ongoing.”
Hats off to the BoZ and DEC for their vigilance in protecting members of the public from being exploited by unscrupulous financial service providers.
It is also gratifying to hear that BoZ will soon issue a statement to help members of the public distinguish village banking from money circulation schemes and what constitutes financial services.
These scammers are prying on the ignorance of people, who are desperate to grow their money and invest it in various business ventures.
It is an undeniable fact that a lot of people are finding means and ways of growing their money and the advent of the village banking concept has come in handy for them.
For the majority of women in townships, village banking is a cheaper and easier way of saving their money.
They do not need to go through the complicated process of securing their membership as it is in commercial banks.
But this does not mean that these financial service organisations should betray their members’ trust and swindle them out of their money.
We recognise that there are some financial service organisations with good intentions but the dishonest behaviour of others should not taint the image of those dedicated to serving the people.
Members of the public should also conduct due diligence on some of the financial service organisations before entering into financial transactions with them.
Help must be sought from those who understand financial regulations to avoid being caught up in a web of scandals brought about by some village banking schemes.
DEC and BoZ should do more by providing vital information to people, especially women, on how to distinguish between village banking and money circulation schemes.
A statement alone will not be enough to spread the information about the dos and don’ts regarding village banking schemes.
Many people are falling prey to these scammers not because they are not smart but people always assume that anything to do with financial services like village banking has the blessing of the central bank.
Many people do not take time to know if these organisations are operating under licence or not.
In most cases they are called to meetings for the purposes of galvanising numbers and not necessarily to let them in on the legitimacy of their operations.
Once again, we would like to commend BoZ and DEC for their work and urge them to provide more information on such scams to vulnerable members in townships.

Facebook Feed